mobilezone holding ag

Earnings Release • Mar 8, 2025

News Details

Ad-hoc | 7 March 2025 06:45

mobilezone expands market position in the MVNO business area in Switzerland and Germany – special effects weigh on the operating result

PRESS RELEASE

Ad hoc announcement pursuant to Art. 53 LR

Rotkreuz, 7 March 2025

Markus Bernhard, Executive Delegate of the Board of Directors, says: “After a stable first half of the year, we clearly felt the generally lower sales volume in Switzerland in the second half of the year, as well as the continued difficult market environment in Germany, which  urged us to expand our  personnel restructuring efforts. Additionally, the past year was impacted by numerous special effects amounting to CHF 24 million. The MVNO division continued  to thrive and we achieved significant growth throughout the year, meeting our growth targets. This positive development makes us proud and confirms our strategic direction. The business performance since the beginning of the year, as well as the continued strong potential of our MVNO brands give us confidence for the new year”.

Financial Guidance

The EBIT, adjusted for special effects of CHF 24.4 million, amounts to CHF 52.7 million and is within the adjusted guidance for the 2024 financial year of CHF 52 to 57 million published on 13 December 2024.

Telecommunications contracts sold (postpaid, Internet and TV)

• Group: 1,625,000 / +1.1 per cent (previous year: 1,607,000)
• Germany: 1,120,000 / +2.5 per cent (previous year: 1,093,000)
• Switzerland: 505,000 / -1.8 per cent (previous year: 514,000)

MVNO business performance

• The number of MVNO (Mobile Virtual Network Operator) subscriptions increased by 27 per cent from 295,300 to 373,800 in the reporting year.
• Adjusted MVNO sales increased from CHF 63.8 million to CHF 76.9 million, with sales growth of 20.5 per cent.
• The adjusted EBITDA contribution of the MVNO amounted to CHF 26.7 million (previous year: CHF 22.8 million) or 39.9 per cent (previous year: 28.5 per cent) of the adjusted total EBITDA of CHF 66.9 million (previous year: CHF 80.1 million).

Key figures at a glance

• Adjusted for currency and special effects in the amount of CHF 20 million, sales totalled CHF 1,025 million (+1.2 per cent). Of the adjusted consolidated sales of CHF 1,010 million, 73 per cent were generated in Germany and 27 per cent in Switzerland (previous year: 70/30 per cent).
• Adjusted gross profit totalled CHF 190.6 million (previous year: CHF 206.4 million).
• Operating income (EBIT), adjusted for the following special effects, amounted to CHF 52.7 million (previous year: CHF 68.7 million) with an EBIT margin of 5.2 per cent (previous year: 6.8 per cent), to which Switzerland contributed 57 per cent and Germany 43 per cent (previous year: 53/47 per cent).
  • Adjustment of the accounting for MVNO HIGH in the amount of CHF 1.6 million.
  • Impairments of capitalized IT platforms in Switzerland and Germany of CHF 16.0 million.
  • Severance payments from reorganization in Germany of CHF 3.2 million.
  • Last OPPO inventory adjustment of CHF 0.7 million from an insolvency case from 2023.
  • Settlement of differences with an industrial partner in Switzerland totalling CHF 1.8 million.
  • Out-of-court settlement in insolvency proceedings in Germany of CHF 1.1 million.
  • Of the total special effects amounting to CHF 24.4 million, CHF 20.1 million were non-cash effective.
• Consolidated net income, adjusted for special effects, totalled CHF 38.1 million (previous year: CHF 51.7 million).
• Net cash flow from operating activities totalled CHF 60.8 million (previous year: CHF 29.0 million).
• Net debt decreased by CHF 2 million to CHF 89 million (previous year: CHF 91 million).
• Adjusted for special effects, the net debt/EBITDA ratio was 1.33 (previous year: 1.14).
• As in the previous year, the shareholders' equity in the statutory financial statements of mobilezone holding ltd amounted to CHF 132 million.
• Adjusted earnings per share totalled CHF 0.88 (previous year: CHF 1.20).
• The Board of Directors will propose to the General Meeting a dividend of CHF 0.90 per registered share, unchanged from the previous year.
• The share price was CHF 12.24 on 5 March 2025, compared to CHF 10.38 as of 31 December 2024.

Market area Switzerland

In Switzerland, important strategic milestones were achieved. Our MVNO TalkTalk and Digital Republic, as well as jusit (refurbished smartphones) recorded strong growth and strengthened their market position. The stationary retail business fell short of own expectations.

• Sales fell from CHF 308 million to CHF 276 million or 10.4 per cent, due to the continued strong market trend towards SIM-only contract signings and lower customer footfall.
• EBIT, adjusted for special effects, amounted to CHF 29.7 million (previous year: CHF 37.2 million), which corresponds to a margin of 10.8 per cent (previous year: 12.1 per cent).
• The number of shops totalled 127 (previous year: 127).
• Sold contracts (postpaid, Internet and TV) fell by 1.8 per cent to 505,000 (previous year: 514,000).
• Service sales (fleet management, data transfer, setting up smartphones and other services) totalled CHF 7.4 million (previous year: CHF 7.9 million).
• Sales of accessories consolidated at a high level (-3.9 per cent) and amounted to CHF 24.5 million (previous year: CHF 25.5 million) or 8.9 per cent (previous year: 8.3 per cent) of sales in Switzerland.
• MVNO revenue from TalkTalk and Digital Republic rose to CHF 38.2 million (previous year: CHF 33.0 million). The number of postpaid subscribers at the end of 2024 increased by 21 per cent to 181,400 (previous year: 149,800).
• The sustainability-focused brand jusit was also able to continue its strong growth, with the number of refurbished smartphones having increased 84 per cent compared to the previous year.
• In the 2024 financial year, mobilezone trained 141 apprentices in Switzerland (previous year: 147 apprentices).

Market area Germany

In Germany, despite a challenging market environment, 2.5 per cent more mobile contracts were sold compared to the previous year. However, profitability per contract declined. Similar to Switzerland, further success was achieved in Germany in the MVNO business. The own brand HIGH continued its strong growth momentum from the previous year. The re-launch of the simyo brand in November 2024, a once well-known MVNO across Germany, got off to a promising start.

• In local currency, the German organization increased sales, adjusted for special effects, by 6.3 per cent to EUR 779 million (previous year: EUR 733 million). In the reporting currency CHF, adjusted sales increased from CHF 708 million to CHF 737 million or 4.1 per cent.
• Adjusted for special effects, EBIT amounted to EUR 23.7 million (previous year: EUR 32.8 million), which corresponds to a return on sales of 3.0 per cent (previous year: 4.5 per cent). In the reporting currency, adjusted EBIT amounted to CHF 22.7 million (previous year: CHF 32.0 million).
• In the online business, 615,000 (previous year: 588,000) mobile phone contracts were sold, an increase of 4.6 per cent.
• The volume of B2B trade remained unchanged year-on-year at 505,000 mobile phone contracts.
• A total of 1,120,000 (previous year: 1,093,000) mobile phone contracts were sold online and in B2B retail, which corresponds to an increase of 2.5 per cent.
• Adjusted for special effects, sales at MVNO HIGH and simyo totalled EUR 40.6 million (previous year: EUR 31.6 million). The postpaid customer base stood at 192,400 (previous year: 145,500) and increased by 32 per cent.

Growth in Second Life and refurbishing smartphones

The "Second Life" segment, which includes smartphone repairs and refurbishments, continued to expand its presence. The number of refurbished devices sold under the jusit brand increased by 84 per cent to 16,300. This corresponds to 9.1 per cent (previous year: 4.3 per cent) of the total number of smartphones sold by mobilezone in Switzerland. The expansion in the Second Life segment shows that our range of high-quality and certified refurbished devices is in line with the trend of a sustainable device cycle and, consequently, increasing customer demand. We therefore see further growth potential in this business area.

Good growth momentum in the MVNO division

With a customer base of 373,800, the MVNO division proceeded on its strong growth path in the past financial year. Thanks to a juicy growth rate of 27 per cent last year, the number of customers has quadrupled over the last five years. In addition to our TalkTalk and Digital Republic brands in Switzerland, a complementary brand, simyo, has been launched in Germany alongside HIGH. Due to the continued dynamic growth, the margin potential and the recurring revenue character of the MVNO business, we see further value creation potential, particularly to further improve the quality of earnings.

Change in the Board of Directors

After seven years as a member of the Board of Directors, Gabriela Theus will not be standing for re-election at the next General Meeting. The Board of Directors would like to thank Gabriela Theus for her valuable commitment. The Board of Directors will propose Andreas Wyss for election to the Board of Directors at the General Meeting on 2 April 2025. It is planned that Andreas Wyss will take over as Chairman of the Audit & Risk Committee. Andreas Wyss has extensive experience as an auditor and on audit committees.

General Meeting and dividend

The 2025 General Meeting will take place on 2 April in the Gemeindesaal Dorfmatt in Rotkreuz. The Board of Directors will propose to the General Meeting a dividend of CHF 0.90 per registered share, unchanged from the previous year. If this proposal is accepted, the dividend will be paid out on 11 April 2025. The share will be traded ex-dividend from 9 April 2025.

Share buyback programme 2022 to 2025

The share buyback programme 2022 to 2025 will also be suspended in 2025.

Further development of sustainability reporting

mobilezone pursues a comprehensive sustainability strategy based on four focus pillars that cover the entire ESG spectrum (environment, social and governance):

• Governance and compliance
• Employees
• Customers
• Environmental management (incl. circular economy)

Our customers are the center of our daily business activities – online and offline – and should be served with the best products and services in the most resource-efficient way possible. With our Second Life products, we contribute to the circular economy and to extending the usage cycle in the mobile phone market. In the reporting period, mobilezone’s carbon footprint was calculated for the second time and shows a 12 per cent reduction for the reporting year. As part of the Science Based Targets initiative (SBTi), mobilezone has also committed to reducing its carbon footprint in line with the Paris climate targets.

The sustainability reporting is based on the GRI standards and comprehensively fulfils the requirements for non-financial reporting stipulated by the Swiss Code of Obligations. The report on non-financial matters in accordance with Art. 964b of the Swiss Code of Obligations will be presented to the General Meeting on 2 April 2025 as part of a consultative vote.

Outlook 2025

It is our conviction that we are well-positioned for the future thanks to our strong market positions and a strategy focused on the core business. For the 2025 financial year, we expect an EBIT of CHF 53 to 60 million. At segment level, we expect an EBIT margin of 11.0 to 12.0 per cent for Switzerland and 3.0 to 3.5 per cent for Germany. Guidance for the segmental EBIT margin targets is provided for the first time.

Investments excluding customer acquisition costs in 2025 are expected to be at around CHF 10 million (reporting year: CHF 7.6 million). As in previous years, we expect solid cash generation and consequently a stable net debt ratio (net debt/EBITDA) of <2. The attractive dividend policy will be continued.

For the MVNO division, which comprises our TalkTalk, Digital Republic, HIGH and simyo brand, we expect our customer base to continue to grow strongly by almost 20 per cent to over 440,000 customers.

Based on the reduced cost base, continued strict cost management, and our strong market positions in our core markets, we confidently anticipate positive development in the 2025 financial year and beyond.

The Annual Report 2024 with the detailed financial statements in accordance with Swiss GAAP FER is now available at www.mobilezoneholding.ch/en/investors-1/reports-and-presentations.html .

A video conference for investors, analysts and media representatives will take place today, 7 March 2025, at 9.15 am. The online conference will be held in German and participation is possible via the following link: https://www.mobilezoneholding.ch/de/investoren/videokonferenz.html

Ad-hoc Press release according to Art. 53 KR (PDF)

Contact for analysts, investors and media representatives

Pascal Boll

Director Group MVNO & Investor Relations

mobilezone holding ag

mobilezoneholding@mobilezone.ch

About mobilezone

Founded in 1999, mobilezone holding ltd is the leading independent Swiss and German telecoms specialist with a turnover of CHF 1.0 billion and a consolidated operating profit of CHF 52.7 million in the reporting year 2024. The registered shares of mobilezone holding ltd (MOZN) are traded on the SIX Swiss Exchange Ltd.

The mobilezone Group employs almost 1,000 people at its sites in Rotkreuz, Urnäsch, Cologne, Bochum and Münster. It offers a complete range of mobile phones and tariff plans for mobile and landline telephony, digital TV and internet from all providers. Independent advice and services for private and business customers, repair services and supplying specialist retailers complete the range. The services and products are offered online via various web portals and in over 125 shops in Switzerland.

www.mobilezoneholding.ch