freenet AG

Earnings Release • Aug 3, 2023

News Details

Corporate | 3 August 2023 18:04

freenet impresses in the 1st half of 2023: EBITDA, free cash flow and subscribers significantly above prior year

EQS-News: freenet AG / Key word(s): Half Year Results/Half Year Report

freenet impresses in the 1st half of 2023: EBITDA, free cash flow and subscribers significantly above prior year

03.08.2023 / 18:04 CET/CEST

The issuer is solely responsible for the content of this announcement.

freenet impresses in the 1st half of 2023: EBITDA, free cash flow and subscribers significantly above prior year

• Profitability increased again: EBITDA and free cash flow both rise by >5%
• Growth in IPTV accelerates: waipu.tv gains for the first time >100 thousand customers (net) in a quarter
• Market position in mobile remains secure: customer base grows (>100 thousand in H1 2023)
• 2023 Guidance confirmed: EBITDA of EUR 480 to 500 million and free cash flow of EUR 250 to 270 million

Büdelsdorf, 3 August 2023 – freenet AG [ISIN DE000A0Z2ZZ5] today published its results for the 1st half of 2023 .

freenet continues the success story of the previous quarters in the 2023 financial year

In the 1st half of 2023, freenet once again impresses with an increase in profitability compared to the same period of the previous year. The telecommunications company, which is now a relevant player in the TV market, thus underlines its goal of achieving an EBITDA of at least EUR 520 million and a free cash flow of more than EUR 260 million in the 2025 financial year ( freenet 2025 ). Consequently, the Executive Board confirms the guidance for the 2023 financial year (EBITDA: EUR 480 to 500 million; free cash flow: EUR 250 to 270 million) and therefore also expects an increasing dividend per share for the 2023 financial year (2022 financial year: EUR 1.68/share).

Table 1: Key figures of freenet AG

Key figure		Unit		30.06.2023	31.12.2022		Change
Total subscribers 1		Thousand		9,285.2	9,042.4		242.7	2.7%
Key figure		Unit		H1/2023	H1/2022		Change
Revenues		EUR million		1,269.9	1,237.0		33.0	2.7%
EBITDA		EUR million		254.6	240.9		13.6	5.7%
Free cash flow		EUR million		131.5	124.6		6.8	5.5%

freenet started the 2023 financial year with a significant increase in profitability and is consistently continuing this development in the 2nd quarter. The company increased EBITDA in the first six months by a total of 5.7% compared to the prior-year period (EUR 240.9 million) to EUR 254.6 million. The consistently high cash conversion (>50%) consequently leads to a free cash flow of EUR 131.5 million (prior-year period: EUR 124.6 million). The main reasons for the increased profitability are higher service revenues and a stable overhead cost base in relation to growth.

The number of subscribers 1 grew in the first six months of the year by 242.7 thousand to 9,285.2 thousand (year-end 2022: 9,042.4 thousand). The growth of waipu.tv subscribers in the 2nd quarter was higher than in any previous quarter and exceeded the 100 thousand mark for the first time. Driven by the strong customer growth, group revenues rose by 2.7% to EUR 1,269.9 million in the 1st half of the year (prior-year period: EUR 1,237.0 million).

Growth in core business secures market position in mobile

The positive development of all key figures in the Mobile Communications segment in the past half year demonstrated freenet’s consistent and successful work in the mobile business.

Table 2: Key figures Mobile Communications segment

Key figure		Unit		30.06.2023	31.12.2022		Change
Mobile subscribers		Thousand		7,489.5	7,386.8		102.8	1.4%
o/w Postpaid customers		Thousand		7,362.6	7,273.7		88.9	1.2%
o/w App based tariffs 2		Thousand		127.0	113.1		13.9	12.3%
Key figure		Unit		H1/2023	H1/2022		Change
Revenues		EUR million		1,104.9	1,092.1		12.7	1.2%
o/w Service revenues		EUR million		840.9	824.0		16.9	2.1%
EBITDA		EUR million		205.0	195.2		9.8	5.0%

A stable postpaid ARPU (monthly average mobile revenue per customer) of EUR 17.8 (prior-year period: EUR 17.8) and the moderate growth of the customers relevant for recurring revenues in the Mobile Communications segment (7,362.6 thousand; 30.06.2022: 7,200.3 thousand) resulted in rising revenues of EUR 1,104.9 million (prior-year period: EUR 1,092.1 million). Service revenues rose by EUR 16.9 million to EUR 840.9 million (prior-year period: EUR 824.0 million) and continues to account for the majority of segment revenues (76%). On balance, the segment contributed EBITDA of EUR 205.0 million (prior-year period: EUR 195.2 million) to the Group EBITDA in the reporting period, which increased by EUR 9.8 million.

waipu.tv grows with >100 thousand subscribers in the 2 nd quarter 2023

In the TV and Media segment , there is a significant increase in customers in the 1st half of 2023. As of mid-year, around 1.8 million private customers pay for the reception of linear television by freenet (waipu.tv; freenet TV).

Table 3: TV and Media segment

Key figure		Unit		30.06.2023	31.12.2022		Change
TV subscribers		Thousand		1,795.6	1,655.6		140.0	8.5%
o/w waipu.tv subscribers		Thousand		1,153.6	970.0		183.6	18.9%
o/w freenet TV subscribers (RGU)		Thousand		642.0	685.6		-43.6	-6.4%
Key figure		Unit		H1/2023	H1/2022		Change
Revenues		EUR million		165.9	148.7		17.2	11.6%
EBITDA		EUR million		59.2	54.3		4.9	9.0%

The strong growth of waipu.tv subscribers and the positive business development of the infrastructure service provider for the media industry Media Broadcast (B2B) resulted in a significant increase in revenues of 11.6% to EUR 165.9 million (prior-year period: EUR 148.7 million). freenet TV showed a slowdown in the decline in customers for the first time in years and provided a stable contribution to revenues due to price increases.

As a result of the significant customer and revenue growth, the segment’s EBITDA increased by 9.0 % year-on-year to EUR 59.2 million (prior-year period: EUR 54.3 million) and exceeded the first time the EUR 30 million mark in a quarter. However, EBITDA growth – in each case in a year-on-year comparison – weakened in the 2nd quarter 2023 (4.9%) compared to the 1st quarter 2023 (13.8%). This is mainly due to the intensified marketing investments of waipu.tv to participate even more strongly than before in the structural change in the German TV market towards an IPTV-dominated market. The profitability-oriented acquisition of new customers remains the focus of the company.

Conference Call

The conference call on the results of the 1st half of 2023 will take place on Friday, 4 August 2023 at 10:00 a.m. (CEST). All interested parties can follow the conference call via webcast (listen-only mode). A recording will be made available afterwards.

Further documents for publication

Half-year report 2023

Presentation H1/Q2 2023

******************************

1 Total of postpaid, freenet FUNK, freenet FLEX, waipu.tv subscribers and freenet TV subscribers (RGU)

2 freenet FUNK and freenet FLEX customers

Note

In the interests of clear and transparent presentation, alternative performance measures (APMs) are used in the financial statements of freenet AG and in ad hoc disclosures in accordance with Article 17 MAR, in addition to the disclosures defined by the International Financial Reporting Standards (IFRS). Information on the use, definition and calculation of APMs can be found in the 2022 Annual Report.

******************************

Contact

freenet AG

Investor Relations & ESG Reporting

Tel.: +49 (0) 40/ 513 06 778

E-mail: ir@freenet.ag

fn.de/investors

freenet AG

Public Relations & Corporate Communications

Tel.: +49 (0) 40 / 513 06 777

E-Mail: pr@freenet.ag

www.freenet.de

---

03.08.2023 CET/CEST Dissemination of a Corporate News, transmitted by EQS News – a service of EQS Group AG.

The issuer is solely responsible for the content of this announcement.

The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.

Archive at www.eqs-news.com

---

Language:	English
Company:	freenet AG
	Hollerstrasse 126
	24782 Buedelsdorf
	Germany
Phone:	+49 (0)40 51306-778
Fax:	+49 (0)40 51306-970
E-mail:	ir@freenet.ag
Internet:	www.freenet.ag
ISIN:	DE000A0Z2ZZ5, DE000A1KQXU0
WKN:	A0Z2ZZ , A1KQXU
Indices:	MDAX, TecDAX
Listed:	Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
EQS News ID:	1695705

End of News	EQS News Service