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  • 19 Feb 2016
  • ·
  • Finance

Cellnex Telecom revenues grow by 40.6% to €613 million in 2015 . EBITDA increased 32% to € 235

Cellnex Telecom revenues grow by 40.6% to €613 million in 2015.EBITDA increased 32% to € 235

    • Cellnex closed 2015 with an EBITDA of 235 € million (+32%). In 2016 high teens ebitda growth expected
    • Recurring free cash flow for the year grew by 28.4% to € 194 million, representing an EBITDA to cash conversion rate of 83%
    • Cellnex Italy, comprised of TowerCo and Galata, added 28.4% of total company revenue (€ 174 million)
    • 50% of Cellnex revenues (€ 303 million) are attributable to the mobile telephony business segment. Broadcast infrastructures (€ 225 million) added 36.7%, while 13.8% (€ 85 million) were generated in return for providing network services (security, emergency, Smart cities)
    • Net debt as at 31 December amounted to € 928 million (annualized debt/EBITDA ratio of 3.7x)
    • The € 600 million bond issue (20 July 2015) brought equilibrium to the debt structure: improved its maturity (from 3.9 to 6.6 years) at a competitive cost of 2.2%; 54% of the debt is set at a fixed rate; “covenants” were removed and funding sources were diversified
    • In Spain, the awarding of six new licences for three channels in SD and three in HD last October 2015 will make it possible to recoup the revenue for transporting the signal of these channels, occupying a capacity of 1.75 multiplex
    • Orange and Cellnex Telecom deploy the first Small Cell 4G network in Barcelona, in cooperation with the local council

Barcelona, 19 February 2016.– Cellnex Telecom announces its full year results for 2015, the first since its transition from Abertis Infraestructuras to an independent company, following its 7 May 2015 IPO. Cellnex has delivered a increase in revenue to € 613 million, and growth in recurring EBITDA to € 235 million in line with expectations. Net profit closed at € 48 million.
Key influencing factors versus 2014 is comprised of the broadcast termination of nine TV channels in May 2014 and the consolidation of the 7,377 towers acquired from WIND in Italy in the second quarter of 2015.

Francisco Reynés, President of Cellnex Telecom, stated: “closing data for this first year of Cellnex Telecom as an independent listed company confirm the positive trend, in line with the forecasts from analysts and investors after the IPO in May. The key figures of the company’s performance reflect a management approach that has maintained its focus and concentration on day-to-day business, efficient delivery, and keeping a close watch on the growth opportunities which are currently on the company’s agenda. Effective management of the organic business, cost efficiency and a commitment to build a European reference project on the back of the strength and capabilities deployed in Italy and Spain, mark the company’s overall approach.”
Tobias Martínez, CEO of Cellnex, said: “the progression of the company’s business areas have lived up to expectations. We have met significant challenges such as the integration of Galata in Italy, our IPO along with increased demands on cost and operations management. Spain’s DTT channels were fewer during 2015, and we anticipate 1.75 multiplexes linked to 6 new channels to be operational and served by Cellnex as signal carrier in April. Against this backdrop, Cellnex has again demonstrated the resilience of its business model and closes its first financial year on a positive note.”

Organic growth, improved occupancy rate, investments
Cellnex’s business segments comprise the following areas by revenue split: mobile telephony infrastructures (including Galata) contributed 50% of revenue to the tune of € 303 million; audiovisual broadcast networks contributed 36.7% of revenue, amounting to € 225 million; and lastly safety and emergency service networks and solutions for smart urban infrastructure management (IoT and Smart cities) contributed 13.8%, totalling € 85 million.
Cellnex Telecom had a total of 15,119 sites (7,709 in Italy and 7,410 in Spain), versus 7,493 in 2014 as at the end of full year 2015. The organic growth of points of presence (PoPs) on the existing base of towers stood at 8% in relation to the close of 2014, while the occupancy rate was 1.53 (1.51 to the 9 months of 2015). This is a reflection of business activity, with the signing of new service provision agreements with mobile and telephony operators and audiovisual communications groups both in Italy and Spain.
Investments for the period totalled € 787 million: 740 million for expansion (to highlight 693 in the Galata operation in Italy in March, and 44 for the acquisition of a package of 300 towers from Telefónica last January); € 40 million was allocated to maintaining installed capacity and to activities attributed to new revenue generation, for example rationalising the stock of telephony towers which allows for increased efficiencies in the installed capacity.

Cellnex Telecom growth areas
There is an ongoing analysis of European inorganic growth opportunities, especially in relation to sector consolidation and the prevalence of network infrastructure spin-offs and outsourcing.
Beyond this inorganic assessment, Cellnex Telecom has set itself key main areas for growth and organ-ic development over the next years:
rationalising sites (an estimation of 2,000 medium term) through agreements with telephony operators to optimise their cost structures and investment needs, or the build to suit agree-ment–as part of the acquisition of Gatala last year- of 400 sites to cover WIND service demand in Italy;
fibre-optical connection to sites that are key to the effective roll-out of broadband in mobility by the company’s customers;
service management agreements in countries that are not currently part of the company’s priority focus but may represent new opportunities for expansion in the medium and long term;
plans to roll out the new generation of “small cells” to improve service in certain areas of big cities.

Coherently with this last key driver of growth, Cellnex has signed an agreement with Orange, and the cooperation of the City of Barcelona, to deploy the first Small Cells 4G network in the city. This first deployment will allow the validation of the relational model between mobile operators, infrastructure operators as Cellnex, and the local council to better assess future and more extensive deployments.

Debt structure
Cellnex Telecom’s bond issuance of € 600 million, with a maturity of seven years to 2022 and a coupon of 3.125%, was six-times oversubscribed at its inauguration on the 20 July 2015.
With this issue, Cellnex now has a stable long-term debt structure (6.6 years compared to 3.9 years before the issue) with an average cost of 2.2% and a fixed-rate referenced debt of 54%. This refinanc-ing process makes it possible to have longer maturities, eliminate covenants and to diversify sources of funding.

The company’s net debt at the end of the half-year was € 928 million compared to 342 million at the end of 2014, after financing the acquisition of the portfolio of WIND towers for € 693 million. The net debt/EBITDA ratio was 3.7x.

About Cellnex Telecom
Since it acquired the portfolio of telecommunications towers from WIND in Italy last March, Cellnex Telecom has become Europe’s leading independent operator of wireless communications infrastructure, with a total portfolio of 2015 towers.
Cellnex classifies its activities into three areas: mobile telephony infrastructures; audiovisual broadcasting networks; security and emergency service networks and solutions for smart urban infrastructure and services management (smart cities and the “Internet of Things” (IoT).

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