IN 2019, TDF GROUP INVESTED AND CONTINUED ROLLING OUT TELECOM AND FIBER INFRASTRUCTURE
In 2019, TDF posted:
- €654.8 million revenues, up 3.2%, boosted by the roll out of telecom and fiber infrastructure
- Capital expenditure up 20.2% at €305.9 million, or 46.7% of revenues
- Increased production capacity including 84,000 FttH plugs built and 307 new telecom masts erected
- €367.8 million EBITDA, up 6.2%
2019 Group results confirm the Company made the right decision to pursue a very significant investment strategy over the last few years. This self-funded investment and industrial production enhancement strategy has resulted in sharp growth of ultra high-speed fixed and mobile broadband infrastructure. Looking forward, the Company will maintain this strategy.
- In telecom infrastructure, the Company continues to build masts in order to step up mobile coverage for the French regions. Ramping up TDF’s masts construction program and marketing of existing infrastructure to meet the requirements of the 2018 Mobile New Deal between the French government, the French telecom regulator and the country’s four main mobile operators, has resulted in the Company posting improved earnings.307 mobile telecoms masts were erected in 2019 amounting to a cumulative total of over 800 since the 2016 launch of the masts construction program. TDF’s 1,000 built masts goal will be reached in 2020.
As a result, the number of points of presence is up 1.5% (+5.1% like-for-like adjusting for churn from the network sharing deal – RAN sharing – between Bouygues Telecom and SFR), which was primarily attributable to TDF’s mast construction program.
TDF’s site hosting business (hosting mobile operators at Company sites) benefitted from 6.9% like-for-like revenue growth. - Fiber installation is well underway. In 2019, the Company broke through the 100,000 built plugs mark in 164 towns, including 84,000 installed in 2019. With its 250,000 built or in-progress plugs (representing one third of the 750,000 total of the Company’s contracts with four French departments – Val d’Oise, Yvelines, Loir-et-Cher/Indre-et-Loire and Maine- et-Loire), the Company consolidates its market leadership and showcases its industrial expertise. Commercialization has begun in all regions. Penetration rates for plugs marketed after at least one year stand at over 20%. In French department Val d’Oise, the roll-out is nearly finished. Marketing has started in respect of 110 towns including 80 since 2019.
- Radio/TV revenues have been stable since the so-called ‘second digital dividend’ hit, which reduced the number of DTT multiplexes from eight to six because the 700MHz bandwidth was transferred to mobile operators. Against this backdrop, the Company continues to bear down on costs and resources, while offering top service quality to customers.
Significant investment and increased production capacity
In 2019, the Company continued to invest heavily in telecoms and fiber infrastructure and in so doing, confirmed its status as a major industrial player:
- €305.9 million capital expenditure or 46.7% of revenues, up 20.2% year-on-year. Capex included €238.1 million spent for growth, largely in the Telecoms and Fiber businesses.
- This significant capital expenditure means the Company can step up building masts andfiber infrastructure on behalf of customers, while keeping control of costs and resources. The Company continued to add new sites, which now total 18,600 marketable sites, including 6,900 active sites (i.e. masts, towers, rooftops, train stations etc).
- Stepping up mast infrastructure rollout is only possible due to TDF’s industrial capabilities. The Company controls the entire construction process from start to finish.
In the last few years, TDF sold its media services subsidiaries, so it is now fully focused on its three main businesses: mobile telecom infrastructure, rolling out optical fiber and radio/TV broadcasting. After Mediamobile in November 2018, Bebanjo was sold in November 2019. Cognacq- Jay Image (formerly Arkena) was sold on January 8, 2020. The Company’s refocusing on the core infrastructure businesses and its increased infrastructure investment on behalf of customers, combined with enhanced control over expenses, has boosted earnings. Like-for-like EBITDA rose 6.2% to €367.8 million.
As an infrastructure operator and digital developer, the Company helps to ensure that all French people can enjoy DTT and digital radio. As a result of its expanded infrastructure, the Company participates in upgrading superfast fixed and mobile broadband, that is essential for French society.
TDF Group CEO Olivier Huart said: “Our significant investment across our telecom and fiber infrastructure supported further expansion of our business and contributed to enhanced earnings. Backed by our production capacity, we will continue to invest into the rolling out our telecom and fiber infrastructure to further boost digital coverage across France.”