Group spins off towers, reports a solid Q3 with group revenues up 3% and earnings by 0.6% with net profits of €201m
First up, Austria’s A1 Group will include Netflix in its fixed and mobile offers across six markets. The package was launched in Austria this week, with Bulgaria, Croatia, North Macedonia, Serbia and Slovenia to follow.
A1’s customers will have access Netflix from across all devices, and the service will be integrated into A1’s Xplore TV Box in early 2024. The group’s Xplore TV package already provides access to YouTube, Prime Video, Voyo, Canal+ and other content streaming services.
A1 Group’s CEO, Alejandro Plater, said in a statement, “We are always aiming to combine the most coveted services with our offers to enrich the experience our customers have with A1.”
A very pragmatic approach, given that the overdue outcome of the European Commission’s consultation on the fair-share issue was for operators to wait (analysis here from Strand Consult – the European Commission just cancelled Christmas).
Proponents of the fair-share arrangement, mostly but not exclusively network operators, and not all network operators, are arguing that the handful of Big Tech platforms that generate 60%+ of all internet traffic should pay for towards its carriage.
Reports a solid Q3
A1 Group also had a satisfactory Q3: Plater said, “We have seen a solid third quarter affected by one-off effects and FX fluctuations. Group revenues increased by 3% and service revenues grew by 4.5% supported by solid operational development and indexation measures in most of the markets.
“Despite some headwinds from FX development and a non-operative special factors EBITDA [earnings before interest, taxes, depreciation, and amortization] rose by 0.6%. Net result for the third quarter of 2023 was €201 million.”
During the quarter, the group spun off and separately listed EuroTeleSites, which Plater described as “a major strategic milestone”. He added, “The existing towers assets will be better utilized, we have reduced our financial debt by €1 billion and will be able focus even more on our core business.
More detail
Thomas Arnoldner, Deputy CEO of A1 Group added, “In mobile communications, the number of subscribers increased by 5.7% (year-on-year basis), driven primarily by strong growth in the M2M business and demand for mobile Wi-Fi routers. There was also an increase of 1.6% in RGUs [revenue-generating units] (year-on-year). Fibre optic products, as well as the solutions and connectivity business, contributed to growth.”
“The high-performance and future-proof fixed-network and mobile communications networks of the A1 Group are part of critical infrastructure. We further increased our 5G presence in most of our markets and continued our fibre roll-out in Austria.”
Hence the group is sticking to the forecasts it made on Capital Markets Day, at the start of September, for 2024-2026, namely:
- Annual revenue growth of 3-4% based on current inflation and exchange rate expectations;
- Annual EBITDA growth of 4-5% based on current inflation and exchange rate expectations; and
- Cumulative capex of €2.8 billion, excluding spectrum.