Altice NV : First Quarter 2016 Pro Forma Results
May 11 2016 - 1:02AM
ALTICE - FIRST QUARTER 2016 PRO
FORMA[1]
RESULTS
-
Altice Group continues positive
operational momentum in Q1 2016:
-
Overall Altice Group added 67k
postpaid mobile customers and 105k fiber broadband
customers
-
France: continued fiber
customer net additions (+66k) and B2C mobile postpaid net losses of
-28k (vs. -144k in Q1 2015) despite challenging market environment
characterized by heavy promotions, high-end base adding
+13k
-
Portugal: continued convergent
4P/5P (+6k) and postpaid mobile subscriber growth (+35k) with best
customer service metrics in the market[2]
-
Suddenlink: strong customer
relationship (+22k) and broadband subscriber growth
(+30k)
-
Dominican Republic: continued
postpaid mobile subscriber growth (+15k) and fiber customer net
additions (+4k)
-
Israel: stabilization of cable
customer base (-2k, best performance since Altice IPO) with return
to growth in March
-
Operational momentum setting
the base for improvement in revenue trends throughout
2016:
-
France: stabilized customer
base, content enriched service bundles, pricing initiatives and
improving market dynamics to drive significant top-line improvement
vs. Q1 2016 (-6.1% YoY)
-
Portugal: revenue inflection
reached in Q1 2016 (-3.5% vs. -8.7% in Q4 2015) driven by B2C trend
inflecting as B2B segment is expected to improve further in
2016
-
US: return to historical growth
rate (+6.7% vs. 3.7% in FY 2015 on a CC basis) as a result of
customer and ARPU growth
-
Robust financial performance
despite temporary weakness in France with MEO and Suddenlink
delivering record results:
-
Strong growth in Portugal
(adjusted EBITDA +20.9% YoY), US (+18.5% on a CC basis) and
Dominican Republic (+7.5% on a CC basis) offsetting weakness in
France (-9.0%);
-
Group EBITDA and Operating Free
Cash Flow grew 0.9% and 1.1% respectively YoY[3] in Q1
even with accelerated investments
-
Group adjusted EBITDA margin
expanded by 1.3 pp YoY to 37.9% in Q1 as efficiency measures
continue
-
Robust, diversified and
long-term capital structure: Successful €10bn refinancing,
extending Group weighted average debt maturity from 5.9 to 7.3
years (only marginal increase in average cost from 5.5% to
5.8%).[4]
-
Accelerated re-investments into
fiber/mobile networks and selective content:
-
France: leading 4G mobile site
build out in France again in Q1 2016 (+985 sites, more than double
peers) and accelerated fiber broadband coverage expansion (+420k
homes passed in Q1 to total 8.1m, on track for 22m by 2022); #1
fiber coverage in France
-
Portugal: accelerated fiber
broadband coverage expansion (+170k homes passed in Q1 to total
2.4m, on track for 5.3m by 2020)
-
Suddenlink: On track to deliver
next-generation broadband services across the footprint by 2017, at
lower cost than originally planned
-
Media and content acquisitions
to advance "access plus content" strategy in France.
-
FY 2016 guidance
reiterated
May 11, 2016: Altice NV (Euronext:
ATC NA and ATCB NA), today announces financial and operating
results for the quarter ended March 31, 2016.
Strong pro forma
adjusted EBITDA growth in US and Portugal
-
Group Revenue €4,260m, down 2.7% YoY[5]:
-
€2,573m France Revenue, down 6.1%
-
€1,138m International Revenue, up
1.3%[6]
-
€570m US (Suddenlink) Revenue, up 9.0% on a
reported basis[7]
-
Sequential revenue trends and lead key
performance indicators pointing to improving Group revenue trend
outlook for 2016
-
Group adjusted EBITDA €1,615m, up 0.9%
YoY[8]:
-
€851m France adjusted EBITDA, down
9.0%
-
€533m International adjusted EBITDA, up
12.6%[9]; Portugal
(MEO) adjusted EBITDA up 20.9%
-
€242m US (Suddenlink) adjusted EBITDA, up 21.0%
on a reported basis[10]
-
Group adjusted EBITDA margin expanded by 1.3%
pts YoY to 37.9%:
-
France margin contracted by 1.1% pts to 33.1%
due to heavy promotional activity
-
International margin expanded by 4.7% pts to
46.9%; Portugal (MEO) margin expanded by 9.8% pts to 48.4%
-
US Suddenlink margin expanded by 4.2% pts to
42.5%
-
Group Operating Free Cash Flow[11] of
€899m, up 1.1% YoY[12]
Key Strategic
Update
-
SFR: On 27 April 2016, SFR announced the
acquisition of Altice N.V.'s 49% minority stake in
NextRadioTV, a French media operator focused on mainstream news,
sports, business, high-tech and discovery (including leading brands
BFM and RMC); the proposed transaction values NextRadioTV at an
enterprise value of €741m[13] as the
company is acquired at cost relative to the original price paid by
Altice; access to 100% of the economics. SFR also announced it had
entered into exclusive exclusive negotiations to acquire Altice
Media Group France at an enterprise value of €241m or 4.5x adjusted
EBITDA pro forma for tax benefits and synergies.
These content acquisitions are part of a converged strategy to
strengthen SFR's product offerings, aiming to reduce reduce churn,
increase ARPU and revenue growth (including new advertising
revenues). To complement existing TV channels being acquired, SFR
will leverage the NextRadioTV and AMG platforms to launch two new
news channels, BFM Paris and BFM Sport, as well as five new SFR
Sports Channels. SFR has also launched a new open-platform digital
newsstand application (SFR Presse), with all of the AMG content
already available to all SFR customers.
Successful
€10.1bn refinancing of existing debt
-
SFR: Priced $5.19bn of 10-year Senior Secured
Notes (Non-Call 5) and issued new $1,425m and €850m term loans on 6
April, 2016; The Euro equivalent coupon for 7.375% in USD is 5.7%,
marginal increase in average cost of debt from 4.7% to
5.2%.[14]
-
Altice International: Priced $2.75bn of 10-year
Senior Secured Notes (Non-Call 5) on 18 April, 2016; The Euro
equivalent coupon of for 7.5% in USD is 5.8%, average cost of debt
unchanged at c.6.0%.
-
Suddenlink: Priced $1.5bn of 10-year Senior
Secured Notes (Non-Call 5); USD coupon 5.5%, marginal increase in
average cost of debt from 5.3% to 5.5%.
Dexter Goei,
Chief Executive Officer of Altice, said: "We have made
significant progress in executing our operational, financing and
strategic agenda across the group. It has been a challenging
quarter in France but we are confident that our accelerated network
investment program, content-enriched service offering and
operational improvements will deliver improving results throughout
2016 under the new management. Portugal Telecom is well on track to
become the bellwether operator in the European communications
space. We are excited about Suddenlink's performance under our
first full quarter of ownership and its growth prospects. We look
forward to successfully concluding the Cablevision regulatory
approval process and closing the acquisition in Q2 2016."
Contacts
Head of Investor
Relations
Nick Brown: +41 79 720 1503 /
nick.brown@altice.net
Head of
Communications
Arthur Dreyfuss: +41 79 946 4931 /
arthur.dreyfuss@altice.net
Conference call details
The company will host a conference
call and webcast to discuss the results at 2:30pm CET (1:30pm UK
time, 8:30am ET today).
Webcast live:
http://edge.media-server.com/m/p/vj7c4drx
Dial-in Access telephone
numbers:
France: +33 1 76 77 22
26
UK: +44 20 3427 1902
USA: +1 646 254 3365
Confirmation Code: 7645450
[1] Financials
shown in these bullet points are pro forma defined here as results
of the Altice NV Group as if all acquisitions had occurred on
1/1/15, including Portugal Telecom, Suddenlink and NextRadioTV (and
excluding Cabovisao, ONI, La Reunion and Mayotte mobile activities
as if the disposals occurred on 1/1/15). Segments shown on a
standalone reporting basis, Group figures shown on a consolidated
basis
[2] MEO had the
least number of customer service complaints received in 2015 by the
National Communications Authority (Anacom) of all its competitors
in Portugal.
[3] OpFCF
excluding €44m of capitalised exclusive content costs in Portugal
for multi-year contracts
[4] Excluding
Cablevision debt
[5] Group
Revenue declined 3.3% on a constant currency (CC) basis
[6]
International Revenue declined 0.7% on CC basis
[7] US
(Suddenlink) Revenue increased 6.7% on CC basis to $628m in local
currency
[8] Group
adjusted EBITDA increased 0.3% on CC basis
[9]
International adjusted EBITDA increased 11.9% on CC basis
[10] US
(Suddenlink) adjusted EBITDA increased 18.5% on CC basis to $267m
in local currency; IFRS adjustment from US GAAP +$1.3m to EBITDA
and capex
[11] Defined as
EBITDA less Capital Expenditure, excluding exclusive content capex
of €44m in Portugal for multi-year contracts
[12] Group
Operating Free Cash Flow increased 29.4% on CC basis
[13] Including
Numéro 23. NextRadioTV has a minority stake in N23 with an option
to control after 2017 subject to regulatory approvals.
[14] Swaps
executed at slightly better levels than anticipated at the time of
debt raising as announced on 7 April, 2016
Q1 2016 Results
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Altice NV via Globenewswire
HUG#2011530
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