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.
  • Portugal: Completed disposals of Cabovisao and ONI on January 19, 2016.

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
Atotech (NYSE:ATC)
Historical Stock Chart
From Jun 2024 to Jul 2024 Click Here for more Atotech Charts.
Atotech (NYSE:ATC)
Historical Stock Chart
From Jul 2023 to Jul 2024 Click Here for more Atotech Charts.