First-half loss widens but revenues jump for debt-laden towerco
Cellnex reiterated its commitment to break even by the end of 2023 and confirmed its medium-term outlook at its 1H 2023 results.
The towerco boosted its revenues by 18.4% to €2bn, while lifting EBITDA by 16% to €1.5bn. As of June, its net debt stood at €17.9bn and it had access to immediate liquidity of around €3.7bn.
According to Reuters, the towerco is exploring a sale of a minority stake in its Nordic operations that could value the unit at up to €1bn ($1.11bn), as the company looks to pay down debt. It is working with bankers at AZ Capital, a Spanish boutique financial advisory firm, to gauge interest in its Swedish and Danish operations.
Cellnex CEO Marco Patuano said: “We continue to see momentum in the business with strong growth across all of our industrial and financial metrics in the first half of the year. We are making good progress towards the objectives we set last November in the “new chapter” for the Group, with a focus on organic growth, positive free cash flow generation by 2024 and achieving investment grade by 2024 as well.”
The towerco has bolstered its position in France, by extending its industrial agreements with SFR and Bouygues Telecom and in Poland.
With SFR, the partnership will now see Cellnex helping the telco deploy new PoPs on existing and new sites, with a long-term service provision contract for a 20-year period from the starting date of each new PoP and all-or-nothing renewal.
With Bouygues Telecom, Cellnex has agreed to extend the fibre-to-the-tower (FTTT) project roll-out initiated in 2020 through Nexloop, extending the service provision contract until 2050, extendible for successive additional periods of five years. The agreement also includes building up to 65 new metropolitan offices designed to house edge compute data processing centres.
In Poland, where it operates both passive and active infrastructure, Cellnex now controls 100% of the OnTower Poland subsidiary which manages and operates Play’s sites. OnTower Poland currently operates 8,500 sites in Poland and plans to roll out up to around 3,400 new sites by 2030.
Steady state of play
As of 30 June, Cellnex had 112,737 operational sites (without taking into account the 16,060 sites planned to be rolled out by 2030): 25,181 in France, 21,743 in Italy, 15,736 in Poland, 12,558 in the United Kingdom, 10,465 in Spain, 6,464 in Portugal, 5,434 in Switzerland, 4,564 in Austria, 4,088 in the Netherlands, 2,955 in Sweden, 1,947 in Ireland and 1,602 in Denmark; along with 8,541 DAS nodes and small cells.
Organic growth of the points of presence at the sites was 1% higher than the same period of 2022, with 4.1% coming from new co-locations in existing sites, with a total of 2,741, and 3% from the roll-out of 2,220 new sites during this period.
Cellnex invested around €1.5bn in 1H, mainly for new infrastructure and acquiring a remaining 30% of its Polish subsidiary. The towerco also closed a loan of EUR 315 million with the European Investment Bank to finance the deployment of 5G infrastructure in Spain, Portugal, France, Italy and Poland.