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Síminn Interim / Quarterly Report 2024
2203_rns_2025-02-18_22a37504-f3f2-4822-85c0-0fb8321dd4a6.pdf
Interim / Quarterly Report
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53
CRGUPS
Annual Results 2024
María Björk Einarsdóttir and Oskar Hauksson
18 February 2025
69
Operation
Q4 – Strongest Quarter of the Year
The group's performance in the quarter was strong, driven primarily by growth in TV subscriptions, strong advertising sales, and declining churn in telecommunications
- Mobile subscriptions saw significant growth, while roaming revenue remained nearly unchanged year-over-year
- Premium subscribers reached just under 50 thousand at year-end, an all-time high, with Premium revenue increasing by 10% compared to the previous year
- Growth in internet subscriptions was slower than in mobile and TV, but churn has been decreasing due to a stronger focus on data-driven customer retention efforts
- Advertising revenue, excluding Billboard, increased by nearly 12% from the previous year
Financial income remained unchanged year-over-year, while financial expenses increased by ISK 200 million due to higher leverage related to the acquisitions of Billboard and Noona Iceland, along with increased debt impairment
Cash flow from operations, excluding interest and taxes, increased by 45% year-over-year, amounting to over ISK 2.1 billion
5
Income Statement Q4 2024
| Q4 | ||||
|---|---|---|---|---|
| 2024 | 2023 | Change | % | |
| Net sales | 7.291 | 6.468 | 823 | 12,7% |
| Cost of sales | (4.455) | (4.119) | (336) | 8,2% |
| Gross profit | 2.836 | 2.349 | 487 | 20,7% |
| Other operating income | 140 | 191 | (51) | -26,7% |
| Operating expenses | (2.032) | (1.906) | (126) | 6,6% |
| Operating profit (EBIT) | 944 | 634 | 310 | 48,9% |
| Financial income | 195 | 195 | 0 | 0,0% |
| Financial expenses | (489) | (287) | (202) | 70,4% |
| Net exchange rate differences | (12) | (28) | 16 | -57,1% |
| Net financial items | (306) | (120) | (186) | 155,0% |
| Profit before tax | 638 | 514 | 124 | 24,1% |
| Income tax | (121) | (100) | (21) | 21,0% |
| Profit | 517 | 414 | 103 | 24,9% |
| EBITDA | 2.071 | 1.614 | 457 | 28,3% |
| EPS | 0,20 | 0,15 | 0,05 | 33,3% |
Total revenue amounted to ISK 7,431 million, increasing by over ISK 770 million from the previous year
- The main driver was ISK 547 million in revenue from Billboard, which became part of the group at the beginning of the second quarter
- Revenue from Siminn's core products increased by ISK 297 million, or 5,3%, while revenue from fixed-line services continued to decline, decreasing by ISK 30 million compared to the previous year
Cost of sales increased by ISK 336 million year-over-year
- Costs related to Billboard accounted for approximately ISK 250 million of the increase, while infrastructure supplier cost increased by ISK 70 million, since much of the cost is inflation-indexed
Operating expenses increased by ISK 126 million from the previous year
- Of this, approximately ISK 190 million was related to Billboard
Net financial expenses increased by ISK 186 million year-over-year
- Financial income remained stable for the group, while interest income from Siminn Pay's loans increased by ISK 28 million, amounting to ISK 135 million in Q4 2024
- Financial expenses increased by more than ISK 202 million as Siminn has increased leverage in connection with acquisitions
2024 – A New Growth Phase Begins
The company delivered strong results for the year, with EBIT of ISK 2,875 million and net profit of ISK 1,389 million
- Billboard was integrated into operations in the beginning of Q2, contributing over ISK 1.3 billion in revenue and nearly ISK 600 million in EBIT. Billboard's revenue grew by 17% compared to 2023.
- Excluding Billboard, group revenue increased by nearly 3%, EBITDA by over 2%, and EBIT by nearly 14%
- Cost control was effective, though persistently high inflation inevitably impacted operations. The company's largest cost items are linked to infrastructure suppliers, with contracts largely indexed to inflation.
- Changes were made to the executive team and organizational structure in 2024, with total restructuring costs amounting to ISK 215 million
Following years of asset sales, operational streamlining, and cost efficiency measures, the company shifted towards external growth with the acquisitions of Billboard, Noona Iceland, and Valitor's loan portfolio
In the autumn, a CEO change took place, leading to strategic and structural changes aimed at supporting continued growth and diversification of revenue streams
A data-driven, customer-focused approach in sales, service, marketing, and product development—combined with an ambitious digital transformation—reinforces the company's goals of profitable operations, satisfied customers, and engaged employees
5
Income Statement 2024
| 12M | ||||
|---|---|---|---|---|
| 2024 | 2023 | Change | % | |
| Net sales | 27.189 | 25.067 | 2.122 | 8,5% |
| Cost of sales | (17.328) | (16.497) | (831) | 5,0% |
| Gross profit | 9.861 | 8.570 | 1.291 | 15,1% |
| Other operating income | 643 | 674 | (31) | -4,6% |
| Operating expenses | (7.629) | (7.165) | (464) | 6,5% |
| Operating profit (EBIT) | 2.875 | 2.079 | 796 | 38,3% |
| Financial income | 734 | 740 | (6) | -0,8% |
| Financial expenses | (1.841) | (1.102) | (739) | 67,1% |
| Net exchange rate differences | (6) | (30) | 24 | -80,0% |
| Net financial items | (1.113) | (392) | (721) | 183,9% |
| Profit before tax | 1.762 | 1.687 | 75 | 4,4% |
| Income tax | (381) | (341) | (40) | 11,7% |
| Profit | 1.381 | 1.346 | 35 | 2,6% |
| EBITDA | 7.147 | 6.150 | 997 | 16,2% |
| EPS | 0,54 | 0,46 | 0,08 | 17,4% |
Total revenue amounted to ISK 27,832 million, increasing by nearly ISK 2.1 billion ISK from the previous year
- The main driver was ISK 1,328 million in revenue from Billboard, which became part of the group at the beginning of the second quarter
- Revenue from Siminn's core products increased by ISK 1,151 million, or 5,3% while revenue from fixed-line services continued to decline, decreasing by ISK 370 million ISK from the previous year
Cost of sales increased by ISK 831 million year-over-year
- Costs related to Billboard accounted for approximately ISK 630 million of the increase, while infrastructure supplier cost increases amounted to ISK 270 million ISK, with much of that cost being inflation-indexed
Operating expenses increased by ISK 464 million from the previous year
- Of this, ISK 215 million was related to restructuring costs and CEO changes, while ISK 240 million was due to Billboard
EBITDA amounted to ISK 7.147 million and EBIT ISK 2.875 million
- Published guidance for EBITDA was ISK 7,0 – 7,3 billion and EBIT ISK 2,7 – 3,0 billion
- About ISK 150 million in costs due to organizational changes of ISK 215 million and ISK 80 million in amortization of intangible assets were incurred after the guidance was issued
Net financial expenses increased by ISK 721 million year-over-year
- Financial income remained nearly unchanged for the group, while interest income from Siminn Pay's loans increased by ISK 150 million, totaling nearly ISK 500 million in 2024
- Financial income for Siminn decreased by over ISK 160 million, as interest income was unusually high in Q1 2023 when part of the proceeds from the Mila sale was held in cash
- Financial expenses increased by ISK 739 million as Siminn has increased leverage in connection with acquisitions, in addition to higher average base interest rates in 2024 compared to 2023
Operational KPI's
Revenue
EBITDA
Profit
EBIT
Revenue by segment
| Segments | Q4 | |||
|---|---|---|---|---|
| 2024 | 2023 | Change | % | |
| Mobile | 1.743 | 1.656 | 87 | 5,3% |
| Internet & network | 2.064 | 1.976 | 88 | 4,5% |
| TV | 2.096 | 1.974 | 122 | 6,2% |
| Equipment sales | 547 | 523 | 24 | 4,6% |
| Other revenue | 981 | 530 | 451 | 85,1% |
| Total revenue | 7.431 | 6.659 | 772 | 11,6% |
| Segments | 12M | |||
| --- | --- | --- | --- | --- |
| 2024 | 2023 | Change | % | |
| Mobile | 6.858 | 6.510 | 348 | 5,3% |
| Internet & network | 8.277 | 7.939 | 338 | 4,3% |
| TV | 7.905 | 7.440 | 465 | 6,3% |
| Equipment sales | 1.734 | 1.784 | -50 | -2,8% |
| Other revenue | 3.058 | 2.068 | 990 | 47,9% |
| Total revenue | 27.832 | 25.741 | 2.091 | 8,1% |
Mobile: Mobile revenues services whether conventional GSM services, satellite services or other mobile services. Internet & network: Revenue from data services, including xDSL services, GPON, Internet, IP networks, local loops and access networks. TV: Distribution of TV, subscriptions, fees and advertising on Siminn TV. Equipment sales: Revenue from sale of telco equipment and accessories. Other: Income related to telecommunications, fixed line services, information technology and finance. Billboard's income is included here.
Revenue by segment
Mobile
Internet & network
TV
Other segments
Mobile
- Increase in subscribers and revenue during the year
- Roaming revenue remained stable year-over-year
Internet & network
- Slight increase in subscribers in the second half of the year after a significant churn at the beginning of the year
TV
- Strong revenue growth, and Premium subscribers reached an all-time high at the end of 2024
- Robust advertising sales throughout the year
Other segments
- Decline in product sales year-over-year
- Significant revenue decline in fixed-line services as the copper network was decommissioned in 2024. However, the service continues in a new form.
- Billboard was part of this segment in 2024, but from Q1 2025, advertising services will be reported as a separate business segment
Fintech
Síminn Pay - Total loans in end of quarters
Síminn Pay - Interest income
Lending
- Síminn Pay's lending through the Léttkort and Léttkaup products increased by nearly half a billion ISK in 2024, with most of the growth occurring in the second half of the year
- The Competition Authority has approved Síminn Pay's acquisition of Valitor's loan portfolio, with the transaction set to be completed at the end of February
- Following the acquisition, Síminn Pay's total lending will exceed 5 billion ISK
Corporate Card
- The development of Síminn Pay's corporate card continues, reception has been positive
- Currently, 100 companies use the solution successfully, with more joining continuously
Noona Iceland
- Noona Iceland became part of the group in December 2024 and will be operated alongside Síminn Pay
- Booking and payment solutions are now part of Síminn's diverse fintech product offering
Noona Iceland
- Síminn's acquisition of Noona's domestic operations and SalesCloud was finalized in December 2024 following approval from the Competition Authority
- The acquired company, Noona Iceland ehf., will be operated alongside Síminn Pay, with integration of operations and solutions where applicable
- Noona is the largest appointment scheduling system in Iceland, serving around 1,000 businesses and 120,000 registered users, of which 75,000 are active monthly
- SalesCloud's payment solutions are well-suited for small and medium-sized businesses, with its self-service solutions being among the best in the country
- The Noona app received Maskína's Recommendation Award in 2024 in the online service provider category and won an award at UT Messan 2025 for Digital Public Services
- Additionally, Noona was nominated as the best Icelandic brand in the B2B category by the branding agency Brandr
5
Balance sheet and cash flow statement
Balance sheet
| 31.12.2024 | 31.12.2023 | Change | % | |
|---|---|---|---|---|
| Property, plant and equipment | 3.543 | 2.552 | 991 | 39% |
| Right-of-use assets | 1.844 | 732 | 1.112 | 152% |
| Intangible assets | 26.243 | 21.047 | 5.196 | 25% |
| Other financial assets | 638 | 431 | 207 | 48% |
| Non-current assets | 32.268 | 24.762 | 7.506 | 30% |
| Inventories | 1.339 | 1.257 | 82 | 7% |
| Accounts receivables | 2.503 | 2.279 | 224 | 10% |
| Loans (Siminn Pay) | 3.204 | 2.715 | 489 | 18% |
| Other assets | 1.033 | 966 | 67 | 7% |
| Cash and cash equivalents | 835 | 1.810 | (975) | -54% |
| Current assets | 8.914 | 9.027 | (113) | -1% |
| Total assets | 41.182 | 33.789 | 7.393 | 22% |
| Equity | 18.116 | 17.600 | 516 | 3% |
| Equity | 18.116 | 17.600 | 516 | 3% |
| Borrowings | 12.733 | 7.470 | 5.263 | 70% |
| Lease liabilities | 1.571 | 503 | 1.068 | 212% |
| Deferred tax liabilities | 686 | 232 | 454 | 196% |
| Non-current liabilities | 14.990 | 8.205 | 6.785 | 83% |
| Bank loans | 2.084 | 2.281 | (197) | -9% |
| Accounts payables | 3.760 | 4.261 | (501) | -12% |
| Current maturities of borrowings | 780 | 276 | 504 | 183% |
| Other current liabilities | 1.452 | 1.166 | 286 | 25% |
| Current liabilities | 8.076 | 7.984 | 92 | 1% |
| Total equity and liabilities | 41.182 | 33.789 | 7.393 | 22% |
- Increase in Operating Assets and Lease Liabilities primarily due to the acquisition of Billboard
- Goodwill and other intangible assets related to the acquisitions of Billboard and Noona increased intangible assets by ISK 6 billion. However, this was offset by a decrease of ISK 1.1 billion in broadcasting rights and an increase of ISK 280 million in other intangible items.
- New borrowings for the year amounted to ISK 6 billion, including ISK 4.5 billion in bank loans and ISK 1.5 billion ISK in bond issuance
- Commercial papers were issued four times during the year, with an interest margin of around 30 bps. At year-end, Siminn's outstanding commercial papers had a nominal value of ISK 2.2 billion
- A portion of the purchase price for Billboard was settled with own shares valued at ISK 1 billion in Q1 2024
Net interest bearing debt with lease liabilities and Pay
Equity ratio
Net interest bearing debt with lease liabilities to EBITDA
Net interest-bearing debt includes interest-bearing debt and lease liabilities, less cash and cash equivalents as well as Siminn Pay's loan portfolio. 12M EBITDA 2024 includes 12M pro forma EBITDA of Billboard and Noona.
Cash flow
| 2024 | 2023 | |
|---|---|---|
| Operating profit | 2.875 | 2.079 |
| Depreciation | 4.272 | 4.071 |
| Items not affecting cash flow | 57 | 30 |
| Total operating activities | 7.204 | 6.180 |
| Changes in current assets and liabilities | (244) | (568) |
| Cash generated by operation | 6.960 | 5.612 |
| Interest income received | 742 | 758 |
| Interest expenses paid | (1.612) | (947) |
| Payments of taxes | (289) | (570) |
| Net cash from operating activities | 5.801 | 4.853 |
| Net investment in property, plant and equipments | (3.673) | (3.671) |
| Changes in loans (Siminn Pay) | (597) | (1.272) |
| Acquisition of subsidiaries, net of cash acquired | (5.352) | 0 |
| Sale of bond | 0 | 15.685 |
| Investment activities | (9.622) | 10.742 |
| Dividend paid | (499) | (499) |
| Buyback of ordinary shares | (1.424) | (2.976) |
| Share capital decrease | 0 | (15.580) |
| Payment of long term lease | (362) | (265) |
| Net Financing activities | 5.136 | 1.852 |
| Financing activities | 2.851 | (17.468) |
| Changes in cash and cash equivalents | (970) | (1.873) |
| Effect of exchange rate fluctuation on cash held | (5) | (38) |
| Cash and cash equivalents at the beginning of the year | 1.810 | 3.721 |
| Cash and cash equivalents at the end of the year | 835 | 1.810 |
- Net cash from operating activities amounted to ISK 5.8 billion, increasing by nearly ISK 1 billion from the previous year, despite an increase of ISK 665 million in interest payments
- Investments remained nearly unchanged year-over-year, but excluding frequency license costs, investments decreased by ISK 204 million
- Investment is expected to fall significantly when the English Premier League agreement expires later this year
- Siminn Pay's loan portfolio grew by ISK 597 million in 2024, compared to ISK 1,272 million in 2023
- Share buybacks and dividend payments totaled ISK 1,923 million, equivalent to 1.4 times the net profit of 2023. The company's policy is to return at least 50% of profits to shareholders in the form of dividends and/or buybacks
36
CAPEX
CAPEX
- Investments decrease by 204 million ISK between years and are around the middle of the published forecast of ISK 3,300 – 3,600 million
- Investment in TV rights decreased by ISK 490 million year-on-year which is mainly due to how investment in the English Premier League distributes over the period of the contract, which began in 2022 and ends this spring
- Investments in technical infrastructure including routers and STBs increased by ISK 284 million or 18%. About 90 million ISK of this increase is due to investments at Billboard.
- Siminn Pay invested in fintech innovation with focus on corporate cards for ISK 140 million which is increase of ISK 40 million between years or just over 40%
- The guidance for 2025 assumes a further decrease in CAPEX, in the range of ISK 400-700 million, mainly due to the English Premier League contract
Investments are without mobile frequency licenses
CAPEX – Infrastructure and TV content
2020 - 2024
Infrastructure investments
Investments are without mobile frequency licenses
Highlights
Our strategy
A digital community that enriches life
Strong foundation
Emphasis will continue to be placed on the prudence and efficiency in operations.
Strong cash flow and predictability in investments.
Value returned to shareholders through dividends and buybacks.
Profitable operations
Growth and new revenue streams
Increased focus on product and business development in both B2C and B2B markets.
Management will explore further opportunities for external growth in line with the company's strategy.
Síminn's three main revenue streams are telecommunications and technology, digital media and fintech.
Proud workforce
Outstanding experience
Síminn is a digital service company that creates valuable connections for individuals and businesses across various aspects of daily life.
An ambitious digital transformation supports the integration of solutions, delivering a seamless customer experience and operational efficiency.
A customer-centric and data-driven approach in sales, service, marketing, and product development.
Customer service excellence
Síminn's former organizational chart
Síminn's new organizational chart
Our best year in SVOD ever
- At the end of 2024, Sjónvarp Síminn Premium reached a record number of subscribers.
- Síminn premiered the most Icelandic scripted series of any broadcaster during the year. IceGuys broke viewership records in Q4 with its second season, and the third is set to air in 2025.
- Lubbi finnur málbein however had the highest number of plays, reflecting the strong demand for high-quality, educational Icelandic children’s content.
- 2025 will be the biggest year for Sjónvarp Símans Premium to date, with five new Icelandic scripted series premiering.
- Additionally, three new children’s series will debut in 2025.
- Síminn’s collaboration with the Icelandic Handball Association, The Football Federation of Iceland and Livey is thriving, with a record number of live broadcasts from Iceland’s top handball leagues.
Shareholders
Shareholders
Shareholders
| Shareholders 17.2.2025 | Position | % O/S |
|---|---|---|
| Stoðir hf. | 461.194.170 | 17,40% |
| Brú Lífeyrissjóður starfs sveit | 274.877.095 | 10,37% |
| Lífeyrissj.starfsm.rik. A-deild | 258.771.439 | 9,76% |
| Lífeyrissjóður verzlunarmanna | 173.922.187 | 6,56% |
| Gildi - lífeyrissjóður | 149.446.085 | 5,64% |
| Söfnunarsjóður lífeyrisréttinda | 88.830.504 | 3,35% |
| Birta lífeyrissjóður | 86.438.951 | 3,26% |
| Stefnir - Innlend hlutabréf hs. | 78.205.439 | 2,95% |
| Brú R deild | 71.407.033 | 2,69% |
| Lífeyrissj.starfsm.rik. B-deild | 60.306.152 | 2,28% |
| Top 10 shareholders | 1.703.399.055 | 64,28% |
| Other Shareholders | 759.428.483 | 28,66% |
| Shares outstanding | 2.462.827.538 | 92,94% |
| Own shares | 187.172.462 | 7,06% |
| Total number of shares | 2.650.000.000 | 100,00% |
Stoðir hf.
Brú Lífeyrissjóður starfs sveit
Lífeyrissj.starfsm.rik. A-deild
Lífeyrissjóður verzlunarmanna
Gildi - lífeyrissjóður
Söfnunarsjóður lífeyrisréttinda
Birta lífeyrissjóður
Stefnir - Innlend hlutabréf hs.
Brú R deild
Lífeyrissj.starfsm.rik. B-deild
Other Shareholders
Own shares
Shareholders
- The number of shareholders was 931 at the end of 2024
- A dividend of ISK 500 million was paid on 5 April 2024
- Share capital was reduced on 27 March 2024, by 125,000,000 own shares, bringing the company's total share capital to 2,650,000,000
- Siminn partially paid for the acquisition of Billboard with own shares, totaling 101,153,146 shares
- Share buybacks in 2024 amounted to ISK 1,424 million
- The buyback program was completed earlier this month, and Siminn now holds 187,172,462 treasury shares, representing 7.06% of outstanding share capital
- Siminn's share price increased by 35.7% in 2024, and year-to-date, the stock price has risen by 3.3%
- EPS were ISK 0.54 in 2024, increasing by 17% from the previous year.
Outlook for 2025
69
Outlook for 2025
- Síminn Group is off to a good start in 2025 and the outlook for the year is generally good
- There will be changes in the company's operations this spring when the English Premier League contract comes to an end
- This change creates some uncertainty, but plans expect a positive impact on cash flow and EBIT, but negative impact on EBITDA
- The contract is capitalized, and this year's plan assumes that the reduction in depreciation will be greater than possible negative impact on revenue
- General operating expenses will continue to be affected by inflation, but apart from that, the development of the next few months is somewhat predictable
- Noona Iceland's operation will be included from the beginning of the year and a loan portfolio purchased in early March
- Total investments will decrease considerably from 2024 due to lower investments in TV content
EBITDA — ISK 7,0 – 7,4 billion
EBIT — ISK 3,6 – 4,0 billion*
CAPEX — ISK 2,8 – 3,1 billion
- EBIT outlook is without the impact of amortization of intangible assets due to acquisition of companies
Disclaimer
Information contained in this presentation is based on sources that Síminn hf. ("Síminn" or the "company") considers reliable at each time. Its accuracy or completeness can however not be guaranteed. This report contains forward-looking statements that reflect the management's current views with respect to certain future events and potential financial performance. Although the management believe that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct.
The forward-looking information contained in this presentation applies only as at the date of this presentation. Síminn does not undertake any obligation to provide recipients of this presentation with any further information on the company or to make amendments or changes to this publication should inaccuracies or errors be discovered or opinions or information change. Other than as required by applicable laws and regulation.
This presentation is solely for information purposes and is not intended to form part of or be the basis of any decision making by its recipients. Nothing in this presentation should be construed as a promise or recommendation. Statements contained in this presentation that refer to the company's estimated or anticipated future results or future activities are forward looking statements which reflect the company's current analysis of existing trends, information and plans. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially depending on factors such as the availability of resources, the timing and effect of regulatory actions and other factors.
By the receipt of this presentation the recipient acknowledges and accepts the aforesaid disclaimer and restriction.