Altice Europe's French operations generated revenues of EUR 2.60 billion in the second quarter, fractionally up (+0.2%) year-on-year compared to a rise of 3.6 percent in the previous three months. EBITDA decreased 1 percent to EUR 1.07 billion, representing a smaller drop than analysts' consensus forecast. The EBITDA growth rate worsened sequentially from an increase of 1.6 percent in the previous quarter and 19.6 percent in Q4 2019.
With revenues of EUR 2.54 billion, Altice France’s core telecom business achieved an ongoing positive performance, albeit growing at a slower pace (+2.1% from +4.1% in Q1), which was enough to offset the slump suffered by its Media division (-46.0% from -7.3% in Q1). The main growth driver remained the segment grouping B2B and wholesale telecom operations, which saw revenues rise 11.1 percent to EUR 908 million (+8.0% in Q1). This division benefited from a fast recovery in the deployment activities of the SFR FTTH joint venture during the second quarter, after the Covid-19 slowdown that started in March.
Telecom revenues in the consumer division dropped marginally (-2.2%) after four consecutive quarters of positive growth, hurt by a 27.6 percent drop in equipment sales linked to the temporary closure of SFR’s retail stores.
B2C service revenues rose 0.9 percent to EUR 1.50 billion (+2.3% in Q1), supported by ongoing progress in the residential fixed segment (+2.6% from +2.1% in Q1). Impacted by lower roaming, mobile service revenues dipped slightly (-0.3%) to EUR 867 million. Overall telecom revenues excluding equipment and roaming grew by 4.2 percent (+4.4% in Q1), said the company.
Across France and the overseas territories, B2C mobile subscriptions rose 2.8 percent year-on-year to reach 15.88 million. Quarterly net additions for the postpaid mobile base improved to 99,000, compared to 79,000 in the previous quarter, while slightly decreasing from 105,000 in Q2 2019.
The residential fixed base increased 2.1 percent year-on-year to 6.40 million, adding 37,000 net connections since March (+8,000 in Q1 and +31,000 a year earlier). Out of this total, fibre subscriptions passed the 3 million mark, as quarterly net additions improved to 100,000. The marketable footprint, combining FTTH and hybrid fibre-coaxial connectivity, covered 17.46 million homes at end-June, an increase of 1.04 million since end-March.
Altice Europe reports 14% rise in operating FCF, confirms 2020 guidance
Altice Europe, which combines France, International and Altice TV, generated revenues of EUR 3.54 billion in the second quarter, down 1.2 percent year-on-year at constant currency (+3.1% in Q1). EBITDA from telecom operations rose 1.0 percent to EUR 1.43 billion, while total EBITDA was up slightly (+0.3%) to EUR 1.44 billion. Operating free cash flow (adjusted EBITDA less capex) increased 14.3 percent to EUR 776 million (+11.7% in Q1), as total accrued capital expenditure fell to EUR 663 million, from EUR 756 million in Q2 2019.
The group has maintained its 2020 guidance unchanged, based on the assumption of a gradual economic recovery in the second half of the year. The medium-term goal of an organic FCF above EUR 1 billion has also been confirmed.
