FREENET AG TV & Media segment: Contribution to Group EBITDA continues to grow
In EUR million/as indicated FY 2020 FY 2019 Change Q4/2020 Q4/2019 Change Revenue 259.0 253.9 5.1 68.1 66.1 1.9 EBITDA 79.7 73.5 6.2 20.7 20.9 -0.3 thereof inter-segment allocation -6.3 -6.6 0.2 -1.3 -1.5 0.2 EBITDA without inter-segment allocation 86.0 80.1 5.9 22.0 22.5 -0.5 waipu.tv subscribers (in '000s) 572.5 408.3 164.2 572.5 408.3 164.2 freenet TV subscribers (RGU) 901.9 1,021.1 -119.2 901.9 1,021.1 -119.2 (in '000s)
Customer numbers in the TV & Media segment also developed in line with expectations. With strong subscriber growth in the last quarter of the year (+63.0 thousand), waipu.tv comfortably exceeded the previous forecast of 550 thousand subscribers by the end of the year. After a somewhat restrained third quarter due to a lack of major televised sporting events, the IPTV product's customer base recorded the strongest quarter since its launch in 2016, growing to 572.5 thousand subscribers. This represents a year-on-year increase of 164.2 thousand customers (+40.2 per cent), with the company therefore continuing its robust growth from 2019.
In the case of freenet TV, the number of revenue-generating users (RGU) fell to just under 900 thousand as expected in the updated forecast issued in the third quarter of 2020. This year-on-year decline of 11.7 per cent or 119.2 thousand customers is attributable to the 20 per cent price increase introduced in May 2020 as well as the shutdown of satellite customers for profitability reasons completed at the end of the year. Based on the current customer base, the price increase will nevertheless have a positive impact on gross profit and EBITDA in future.
The revenue trend in the TV & Media segment reflects both the price increase at freenet TV and the growing customer base at EXARING AG (waipu.tv) and increased by 5.1 million euros to 259.0 million euros (2019: 253.9 million euros) despite the lack of revenue from Media Broadcast's event business. Both revenue and sales-related effects also have a direct impact on segment EBITDA, which increased by 8.4 per cent to 79.7 million euros (2019: 73.5 million euros). The increase was mainly driven by waipu.tv, whose EBITDA contribution increased by 7.0 million euros compared to the previous year. As a result, the TV & Media business's share of consolidated EBITDA has reached almost 20 per cent overall, with a segment EBITDA margin of more than 30 per cent (+1.8 percentage points compared to 2019). The stable B2B business combined with the growing B2C business provides a sound basis for recording growth via the TV & Media segment in the medium term.
2021 guidance: stable expectations for the freenet Group Revenue for financial year 2020 was in line with expectations at 2,576.2 million euros. Revenue is likely to remain stable overall in 2021. This expectation is based on moderate revenue growth in the TV & Media segment and stable performance in the Mobile Communications core business. Based on this, management expects EBITDA to remain largely unchanged within a range of 415 to 435 million euros.
The free cash flow figure of 237.3 million euros for 2020 includes a positive contribution of around 36.0 million euros from the equity interest in Sunrise (2020 dividend less interest payments) that will no longer be recognized in free cash flow in future due to the disposal of the Sunrise shares in November 2020. If adjusted, this would result in a sustainable free cash flow of 201.3 million euros for 2020. Free cash flow of between 200 and 220 million euros is anticipated for 2021.
The postpaid customer base is once again expected to grow moderately with stable development of postpaid ARPU. When it comes to customer numbers in the TV & Media segment, robust growth in waipu.tv subscribers is anticipated, while the number of freenet TV subscribers (RGU) is likely to decline moderately.
In EUR million/as indicated 2020 reference value 2021 guidance Financial performance indicators Revenue 2,576.2 stable EBITDA 425.9 415-435 Free cash flow (without Sunrise contribution) 201.3 200-220 Postpaid ARPU (in EUR) 18.2 stable Non-financial performance indicators Postpaid customers (in millions) 7.079 moderate increase freenet TV subscribers (RGU) (in millions) 0.902 moderate decrease waipu.tv subscribers (in millions) 0.572 solid growth
The freenet Group expects to publish its final financial results for 2020 on 26 March 2021. The Annual Report for the year ended 31 December 2020 will then be available in the Investor Relations section at https:// www.freenet-group.de/investor/publications/index.html.
Conference call webcast freenet AG will host an analysts' conference call at 10:00 a.m. (CET) on 25 February 2021. All those interested in attending can follow the conference call via webcast at LINK.
A recording will be made available following the event.
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^1 The Executive Board decided to sell the Group's 51 per cent equity investment in MOTION TM Vertriebs GmbH, Troisdorf, as of the end of December 2019. The company's external revenue contribution amounted to 323.5 million euros in the period from January to December 2019 (Q4/2019 96.4 million euros), while its EBITDA contribution was approximately 2.6 million euros (Q4/2019: 1.8 million euros). To improve comparability, the previous year's figures for sales and EBITDA are therefore presented adjusted for MOTION TM. ^2 Sum total of postpaid customers, active freenet FUNK customers, freenet Flex customers, freenet TV subscribers (RGU) and waipu.tv subscribers.
****************************** Contact: freenet Group Investor Relations & ESG Tel.: +49 (0)40/ 513 06 778 Email: ir@freenet.ag https://www.freenet-group.de -----------------------------------------------------------------------------------------------------------------------
2021-02-24 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de -----------------------------------------------------------------------------------------------------------------------
Language: English
Company: freenet AG
Hollerstrasse 126
24782 Buedelsdorf
Germany
Phone: +49 (0)40 51306-778
Fax: +49 (0)40 51306-970
E-mail: ir@freenet.ag
Internet: www.freenet-group.de
ISIN: DE000A0Z2ZZ5, DE000A1KQXU0
WKN: A0Z2ZZ , A1KQXU
Indices: MDAX, TecDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf,
Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1170874
End of News DGAP News Service
=------------ 1170874 2021-02-24
(END) Dow Jones Newswires
February 24, 2021 12:02 ET (17:02 GMT)
