Belgian operator Proximus raised its guidance for the full year, after showing underlying growth in second-quarter results. CEO Dominique Leroy said the company was made good progress on its strategic plan presented after she took office last year and would achieve its ambition to return to growth a year earlier than initially projected. For this year, the operator now expects underlying core revenue growth of around 2 percent and underlying group EBITDA growth of 3-5 percent. The company earlier forecast flat to slightly higher revenues and EBITDA in 2015. In the second quarter, it achieved 2.4 percent annual growth in underlying core revenue to EUR 1.094 billion, which excludes its wholesale business BICS, and adjusted EBITDA up 4.3 percent to EUR 450 million.
On a reported basis, revenue was still down 7.3 percent in Q2 to EUR 1.511 billion. Consumer revenues rose 3.9 percent to EUR 726 million, Enterprise revenues were flat at EUR 327 million, wholesale fell 2.4 percent to EUR 58 million and BICS was down 0.8 percent to EUR 411 million. Reported EBITDA fell 18.3 percent to EUR 456 million, as growth in consumer and BICS was offset by a drop in enterprise and wholesale, mainly due to the loss of Base as a wholesale DSL customer due to its decision to exit the fixed business as well as the antenna tax in Wallonia. An increase in depreciation and financing costs led to a 42.5 percent fall in net profit to EUR 145 million.
Capital expenditure rose to EUR 272 million in Q2, including EUR 75 million for the renewal of the 900/1800MHz spectrum, from EUR 245 million a year ago. The operator also expanded its 4G network to 96.5 percent outdoor population coverage and 81.6 percent indoor coverage and increased the vectoring roll-out to over a third of its VDSL network. Over 435,000 households can now receive speeds of 70 Mbps, up by 45,000 from the last quarter. The higher capex led to a 24 percent fall in cash flow to EUR 207 million in Q2. Proximus still expects full-year capex at around EUR 900 million, excluding the licence fee.
In the consumer fixed market, Proximus said it won 25,000 new broadband customers in the quarter, for a total 1.674 million at end-June. This includes 6,000 customers migrated to its subsidiary Scarlet from Base's Snow offer. Fixed voice customers fell by 5,000 over the same period to 2.136 million. The TV subscriber base increased by 35,000 in the three months and 11 percent year-on-year to 1.692 million. TV ARPU was higher year-on-year thanks to more customers taking extra options, while voice and broadband fell, in part due to more bundled offers. Proximus ended the second quarter with 652,000 customers on triple-play, up 2.9 percent from a year earlier, and 509,000 quad-play subscribers, an annual increase of 12.8 percent.
Mobile service revenues from the consumer segment were up 0.9 percent year-on-year to EUR 255 million. The operator added 38,000 postpaid customers in the quarter, or 26,000 when excluding the free Sims offered to fixed customers. Prepaid customers fell by 40,000, of which 13,000 was due to the discontinuation of MVNO Mobisud. In total, the mobile customer base ended the second quarter at 4.229 million, 0.8 percent higher than a year ago. Postpaid ARPU rose 1.5 percent year-on-year to EUR 29.6, thanks to the success of bundled offers and higher smartphone penetration. The higher 4G usage helped average data usage per customer increase 65 percent year-on-year to 511 MB. The average data consumption of 4G users is over three times greater than that of non-4G users, Proximus said. Prepaid ARPU for the second quarter was EUR 11.2 , down 11.3 percent from a year ago but up slightly from EUR 10.7 in Q1. With the postpaid/prepaid customer mix improving to 67-33 percent from 64-36 percent a year ago, the blended ARPU increased by 1.8 percent to EUR 22.7.
