DIN-CUBE-RED-w2 Profiled in Dynamic Intelligence Network (DIN)

Ziggo prepares to launch an MVNO-based mobile offering in 2nd half of 2013

ziggoftSource Ziggo

Further investments to improve revenue momentum
Investments focused on Ziggo WifiSpots, launch of mobile offerings and customer retention

  • Successful launch of our popular ‘Ziggo WifiSpots’ with 850,000 hotspots to be activated in August
  • Ziggo prepares to launch an MVNO-based mobile offering in 2nd half of 2013
  •  Newly introduced campaigns in Q2 targeted on customer retention
  •  B2B continues to record strong organic revenue growth; first contribution from acquisition of Esprit Telecom
  • Revised outlook for full year 2013 due to higher investments

Operational highlights Q2 2013

  • All-in-1 bundle subscribers up 20,000 in Q2, resulting in 1.4% q-o-q growth and 7.1% y-o-y growth; All-in-1 bundle penetration reaches 53.7% of our consumer customer base
  • Internet subscribers up 20,000 in Q2, representing 1.1% q-o-q growth and 4.6% y-o-y growth
  • Telephony usage revenue down 5.2% y-o-y (down 1.3% excluding FTA rate reduction)
  • Digital pay TV, including Video on Demand, up 1.0% y-o-y
  • B2B adds over 3,500 subscriptions for its business bundles
  • 150,000 set-top boxes made interactive through SGUI, supporting another quarter of strong growth in Video-on-Demand transactions

Financial highlights Q2 2013

  • Revenues up 1.4% y-o-y to €391.9 million (down 0.2% excluding Esprit Telecom). Underlying revenues excluding set-top box sales and other revenues up 0.6% organically, despite a 5.2% decline in telephony usage revenues.
  • Adjusted EBITDA €221.0 million, up 0.8% y-o-y. Excluding Esprit Telecom, EBITDA up 0.3%
  • Free cash flow €95.0 million, down 40.1% y-o-y due to growth in capital expenditure andacquisition of Esprit Telecom
  • Net profit up to €88.9 million, from €64.4 million in Q2 2012
  • Earnings per share €0.44
  • Leverage ratio down to 3.41x compared to 3.42x at year-end 2012

CEO Bernard Dijkhuizen: “During the second quarter we experienced similar market dynamics as in the last few quarters. Our sales campaigns for the All-in-1 bundle were successful and continued to deliver good results, taking into account Q2 seasonality. At the same time, churn levels continued to be relatively high historically, particularly for lower spending customers, having an impact on revenue growth in the consumer market. In order to reduce churn we have developed and launched several programs during the second quarter targeting to improve customer retention. Our focus on sales of All-in-1 bundles and retention had an adverse effect on marketing initiatives for premium TV, contributing to a limited growth in digital pay TV this quarter.

In addition to our loyalty campaigns, we prepared the increase of internet speeds and started to roll out the popular Ziggo WifiSpots. Ziggo WifiSpots creates through the public channel of the modems from all Ziggo internet customers a large number of Wifi-hotspot access points in our footprint for Ziggo customers. The roll out will result in over 850,000 hotspots by the end of the third quarter and close to 1 million before the end of the year. This new service strongly supports the appeal and attractiveness of our services to our customers and the response by customers and media has been overwhelming.

To further leverage the benefits of the Ziggo WiFiSpots we will also launch an MVNO-based mobile offering for existing customers in the second half of this year. This proposition will offer an attractive price for a bundle of call minutes/SMS and mobile data in combination with high quality internet access through the Ziggo WifiSpots. This proposition will grow over time to a fully converged mobile offering.

While in consumer markets RGUs and revenue growth came in below our expectations, we were pleased to see continued strong organic revenue growth in our B2B operations. On top of that we benefited from a first contribution from our acquisition Esprit Telecom. This acquisition will stimulate organic revenue growth in the SME market (small and medium-sized enterprises) going forward, in addition to growth in the small and home offices market through our office bundles.”

Outlook
Following the decision to further step up our campaigns and investments in customer retention, our Ziggo WifiSpots and the launch of our mobile offering, and taking into consideration the higher than anticipated churn in the first half year, our outlook for the full year 2013 will change. We now anticipate 2013 organic revenue growth (excluding ‘revenues from other sources’) to be around 1%, whilst adjusted EBITDA is expected to be in line with last year. Our capital expenditure for 2013 is expected to increase to a range of €330-340 million primarily due to higher investment in customer premises and equipment to support customer retention and investments for the launch of Ziggo mobile.

In line with the dividend policy, Ziggo intends to pay an interim dividend of €190 million, equal to €0.95 per share, in September 2013.

Important dates
This year, Ziggo expects to publish its quarterly results on the following dates: Q3 2013 October 18, 2013
FY and Q4 2013 January 23, 2014

Interim dividend 2013:

September 3, 2013 Ex-dividend (at opening)
September 5, 2013 Record date (after close)
September 10, 2013 Payment date

To continue reading this announcement , please download the Press Release (pdf)

Share
Image Credit(s): (c) All trademarks mentioned in this release are the property of their respective owners

Please take our Survey to help improve the site.5f7232aa8d37115b23583a025e20ef22
BROKEN Link, inaccurate Information, please contact us, and we will check it, and Fix It!
For those of you looking wanting to be included in our site; please use the following Contact Form. If you are an International Roaming MVNO Provider, and want to be included in our upcoming listings, and expose, then please complete the following form.


Copyright policy: All content on this site are the copyright of MVNO Dynamics, unless cited or stated. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of information on the Internet. So our reproduction policy is as follows: You may quote up to 400 words of any of our posts, and articles on the condition that you attribute the credit to MVNO Dynamics and either link to the original article or to www.mvnodynamics.com. All other use is prohibited. MVNO Dynamics will not be liable for any errors or omissions in this information. This site does not mean to harm, or encourage to harm any companies or person(s). Please Refer to our Legal Disclaimer for further information.