TIDMTDE
RNS Number : 6805U
Telefonica SA
26 October 2017
FINANCIAL HIGHLIGHTS
-- Sustained and profitable organic growth.
(R) LTE (1.6x y-o-y), smartphones (+8%) and FTTx & cable (+21%).
(R) Revenues in the quarter (EUR12,754m) grew 4.0% y-o-y in
organic terms (+0.9 p.p. vs. the previous quarter), with service
revenues acceleration (+3.3%; +0.4 p.p). Mobile data revenues
double-digit growth continued (+16.3% y-o-y in organic terms).
(R) In the quarter, OIBDA (EUR4,095m) grew 2.8% in organic terms
y-o-y. OIBDA margin stood at 32.1% (-0.4 p.p. y-o-y organic). RLAH
impact dragged -1.7 p.p. to OIBDA growth y-o-y.
(R) Underlying OIBDA totalled EUR4,116m (-2.7% y-o-y) and excluded EUR21m restructuring costs.
(R) Operating cash flow (OIBDA-CapEx) excluding the spectrum
(EUR6,815m in January-September) maintained a strong pace of growth
(+9.2% y-o-y organic), reflecting lower CapEx intensity
(-2.3%).
(R) Net income in the first nine months reached EUR2,439m, +9.6%
year-on-year, and earnings per share totalled EUR0.44, +8.7%
(EUR839m and EUR0.15, respectively in the quarter).
-- Company transformation continued.
(R) 42.8m premises passed with FTTx & cable and 69% LTE coverage at September 2017.
(R) The focus on E2E digitalisation of processes offers an
unprecedent opportunity to transform the business, already
delivering tangible benefits.
-- Reinforced balanced position.
(R) Free cash flow in the first nine months reached EUR3,226m (+39.2% y-o-y).
(R) Net debt in September stood at EUR47,222m, less 4.8% y-o-y
(-EUR1,265m vs. June 2017). Debt will be further reduced by an
additional EUR1,275m in the fourth quarter, following the closing
of Telxius 40% stake sale.
-- T. España returned to growth in service revenues in the
quarter (+0.4% y-o-y; EUR3,089m). OIBDA reached EUR1,306m (-0.6%
y-o-y excluding capital gains from real estate sales). Operating
cash flow grew 4.7% in January-September.
-- T. Brasil widened its quality gap and posted sustained y-o-y
growth in revenues (+1.2% organic; EUR2,935m) and OIBDA (+6.0%;
EUR1,024m), and posted 3 quarters in a row of OIBDA margin
expansion.
-- T. Deutschland maintained a solid commercial momentum in
July-September, revenues reached EUR1,850m (-1.3% organic) and
OIBDA EUR457m in the quarter, while OIBDA margin expanded (+0.3
p.p. organic) despite the regulatory impact.
-- T. UK; sustained revenue growth (+1.1% organic; EUR1,602m),
despite the strong roaming impact in the quarter, which was
reflected in a EUR412m OIBDA (-4.7% organic).
-- T. Hispanoamérica maintained solid growth in revenues (+16.1%
organic; EUR2,981m) and OIBDA (+9.3%; EUR883m) due to increased
penetration of value accesses and efficiency measures.
-- The Company reiterated its guidance and the dividend announced for 2017.
Comments from José María Álvarez-Pallete, Chairman and CEO:
"Third quarter results reflected the solid execution of the main
strategic priorities set for the year. Thus, our organic growth is
consistent and sustainable, highlighting the improvement in revenue
growth trends and the increased OIBDA, despite the negative impact
of the new regulation in Europe. Additionally, transformation
remained key and the focus on digitalisation amongst the Company's
different operating areas has contributed to increase our
differentiation and become more efficient, and will enable us to
pave a new way to interact with our customers through cognitive
intelligence while improving resource allocation. Finally, we
continued strengthening our balance sheet position with a clear
advance in de-leveraging the Company thanks to growing cash-flow
generation".
TELEFÓNICA
SELECTED FINANCIAL DATA
Unaudited figures (Euros in
millions)
Jan-Sept % Chg July-Sept %Chg
2017 Reported Organic 2017 Reported Organic
Revenues 38,846 1.4 2.9 12,754 (2.5) 4.0
Telefónica España 9,410 (1.7) (1.6) 3,184 (0.3) (0.3)
Telefónica Deutschland 5,392 (3.1) (3.1) 1,850 (1.3) (1.3)
Telefónica UK 4,810 (6.4) 1.9 1,602 (4.4) 1.1
Telefónica Brasil 9,128 13.6 1.5 2,935 (0.5) 1.2
Telefónica Hispanoamerica 9,400 2.8 13.6 2,981 (4.7) 16.1
Other companies & eliminations 706 (18.0) (5.0) 202 (20.7) 4.5
Telxius 547 19.1 8.0 177 5.3 7.5
-------------------------------------
OIBDA 12,274 2.9 3.8 4,095 (1.9) 2.8
Telefónica España 3,731 (4.5) (2.4) 1,306 (3.5) (3.4)
Telefónica Deutschland 1,318 1.4 1.7 457 0.1 (0.1)
Telefónica UK 1,261 (8.3) (0.2) 412 (10.0) (4.7)
Telefónica Brasil 3,162 20.6 6.8 1,024 4.7 6.0
Telefónica Hispanoamerica 2,679 0.4 12.0 883 (9.0) 9.3
Other companies & eliminations 123 105.8 32.5 13 c.s. (177.1)
Telxius 261 48.7 11.4 82 9.6 12.1
-------------------------------------
OIBDA margin 31.6% 0.5 p.p. 0.3 p.p. 32.1% 0.2 p.p. (0.4 p.p.)
Telefónica España 39.7% (1.2 p.p.) (0.3 p.p.) 41.0% (1.3 p.p.) (1.3 p.p.)
Telefónica Deutschland 24.4% 1.1 p.p. 1.2 p.p. 24.7% 0.4 p.p. 0.3 p.p.
Telefónica UK 26.2% (0.5 p.p.) (0.6 p.p.) 25.7% (1.6 p.p.) (1.6 p.p.)
Telefónica Brasil 34.6% 2.0 p.p. 1.7 p.p. 34.9% 1.7 p.p. 1.6 p.p.
Telefónica Hispanoamerica 28.5% (0.7 p.p.) (0.4 p.p.) 29.6% (1.4 p.p.) (1.8 p.p.)
Operating Income (OI) 5,143 7.1 11.2 1,773 3.2 9.4
Net income attributable to equity
holders of the Parent 2,439 9.6 839 (14.7)
Basic and diluted earnings per share
(euros) 0.44 8.7 0.15 (17.5)
CapEx 5,962 (0.9) (2.3) 2,455 3.9 3.7
Telefónica España 1,097 (14.9) (14.5) 392 (0.8) (0.7)
Telefónica Deutschland 688 (8.0) (7.4) 254 (19.6) (19.2)
Telefónica UK 604 (7.7) 0.6 170 (28.7) (23.4)
Telefónica Brasil 1,513 10.6 2.5 598 3.7 12.6
Telefónica Hispanoamerica 1,853 2.9 0.8 931 19.0 15.7
Other companies & eliminations 207 32.6 40.2 111 104.5 123.4
Telxius 136 111.8 107.5 79 n.m. n.m.
-------------------------------------
Spectrum 502 47.5 46.9 498 50.6 50.0
Telefónica España - - - - - -
Telefónica Deutschland 1 (86.7) (86.7) - - -
Telefónica UK - - - - - -
Telefónica Brasil - - - - - -
Telefónica Hispanoamerica 502 78.1 77.4 498 76.8 76.0
OpCF (OIBDA-CapEx) 6,312 6.7 9.2 1,640 (9.6) 2.0
Telefónica España 2,634 0.7 3.5 914 (4.6) (4.5)
Telefónica Deutschland 630 14.1 12.9 203 44.4 36.6
Telefónica UK 658 (8.9) (0.9) 242 10.4 15.2
Telefónica Brasil 1,649 31.7 11.1 426 6.2 (1.8)
Telefónica Hispanoamerica 825 (5.0) 26.8 (48) c.s. 2.7
Other companies & eliminations (84) (13.0) 54.9 (97) 3.6 29.1
Telxius 126 12.6 (25.8) 3 (94.1) (91.1)
------------------------------------- --------- ----------- ----------- ---------- ----------- -----------
- Reconciliation included in the
excel spreadsheets.
Notes:
- 2016 and 2017 reported figures include hyperinflationary adjustments in Venezuela in both
years.
- OIBDA and OI are presented before brand fees and management fees.
- Telxius financials are fully reported in Other Companies & Eliminations in T. Group since
1 January, 2017, reflecting the final integration into Telxius of the mobile communications
towers transferred from T. España, T. Deutschland, T. Brasil and T. Hispanoamérica
segments and the international submarine fiber optic cable (which was already being reported
within Other Companies and Eliminations). As a consequence, 2017 reported figures for these
segments follow the same criteria. In addition, 2016 segment results have been revised to
reflect the different dates of asset integration into Telxius, affecting T. España (since
1 January, 2016), T. Deutschland (since 1 May, 2016), T. Brasil (since 1 April, 2016) and
T. Hispanoamérica (T. Perú since 1 April 2016 and T. Chile since 1 May 2016). Organic
y-o-y changes on segments reflect all the charges related to the towers transferred to Telxius
since 1 January 2016. The results of the segments do not include intra-group capital gains
resulting from the transfer of towers to Telxius.
- Organic criteria: Assumes constant exchange rates as of 2016 (average FX in 2016), excludes
the impact from hyperinflation in Venezuela in both years and considers constant perimeter
of consolidation. In OIBDA and OI terms, excludes write-downs, capital gains/losses from the
sale of companies, tower sales, material non-recurring impacts and restructuring costs. CapEx
also excludes investment in spectrum.
DISCLAIMER
This document may contain forward-looking statements regarding
intentions, expectations or forecasts related to the Telefónica
Group (hereinafter, the "Company" or "Telefónica"). These
statements may include financial forecasts and estimates based on
assumptions or statements regarding plans, objectives and
expectations that make reference to different matters, such as the
customer base and its evolution, growth of the different business
lines and of the global business, the market share, possible
acquisitions, divestitures or other transactions, Company results
and other aspects related to the activity and situation of the
Company.
The forward-looking statements can be identified, in certain
cases, through the use of words such as "expectation",
"anticipation", "purpose", "belief" or similar expressions, or the
corresponding negative forms, or through the own predictive nature
of all issues referring to strategies, plans or intentions. These
forward-looking statements or forecasts reflect the current views
of Telefónica with respect to future events, do not represent, by
their own nature, any guarantee of future fulfilment, and are
subject to risks and uncertainties that could cause the final
developments and results to differ substantially from the ones put
forward through these intentions, expectations or forecasts. These
risks and uncertainties include those identified in the documents
containing more comprehensive information filed by Telefónica
before the different supervisory authorities of the securities
markets in which its shares are listed and, in particular, the
Spanish National Securities Market Commission.
Except as required by applicable laws, Telefónica does not
assume any obligation to publicly update these statements to adapt
them to events or circumstances taking place after this document,
including changes in the Company's business, in its business
development strategy or any other unexpected circumstance.
This document may contain summarized, non-audited or Non-GAAP
financial information. The information contained herein should
therefore be considered as a whole and in conjunction with all the
public information regarding the Company available, including, if
any, other documents released by the Company that may contain more
detailed information.
In October 2015, the European Securities Markets Authority
(ESMA) published guidelines on Alternative Performance Measures
(APM), applicable to regulated information published from July 3,
2016. Information and disclosure related to APM used in the present
document are included in the Appendix. Moreover, recipients of this
document are invited to read our condensed consolidated interim
financial statements and consolidated interim management report for
the six-month period ended June 30, 2017 submitted to the Spanish
National Securities Market Commission.
Finally, it is hereby stated that neither this document or any
of its contents constitutes an offer to purchase, sale or exchange
any securities, a solicitation of any offer to purchase, sale or
exchange of securities, or a recommendation or advice regarding any
security.
For further information please refer to the information on 2017
third quarter financial results filed by the Company and also
available on the Company's web site: www.telefonica.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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