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Towering H1 growth from Cellnex (shame about net losses)Towering H1 growth from Cellnex (shame about net losses)

EBITDA guidance up, but costs related to acquisitions hit bottom line.

Ken Wieland

July 21, 2020

2 Min Read
Towering H1 growth from Cellnex (shame about net losses)

Spain's Cellnex, Europe's biggest listed tower business, posted a fairly robust set of H1 financials (especially if you turn a blind eye to the net income/loss column).

Boosted by a string of acquisitions, EBITDA jumped 64%, year-on-year, to €527 million (US$603 million).

Group turnover came in at €723 million/$827 million (up 48%). Infrastructure services for mobile network operators contributed 77% (€553 million/$633 million), which is a hefty 70% increase compared with the same period in 2019.

More than 60% of Cellnex revenue (and 72% of EBITDA) is now generated outside the firm's domestic market.

Ups and downs
Because of feverish expansionist activity during H1 costing a head-turning €2.5 billion ($2.9 billion), which includes the purchases of OMTEL and NOS Towering in Portugal – plus the acquisition this month of Arqiva's Telecommunications division in the UK – Cellnex upped its full-year EBITDA guidance.

The revised EBIDTA forecast sits between €1.16 billion ($1.33 billion) and €1.18 billion ($1.35 billion), compared with the previous estimate of between €1.065 billion ($1.22 billion) and €1.085 billion ($1.24 billion).

The rapid expansion of the Group's geographical footprint beyond Spain, coupled with what Cellnex describes as an "intense acquisition process," has nonetheless come at a price.

Cellnex posted a H1 net loss of €43 million ($49 billion), largely because of higher amortizations related to acquisitions (up 95% compared with H1 2019) and heavier financial costs (up 23%).

Cellnex said it expected to post net losses in the "coming quarters," which perhaps explains why its share price fell by nearly 2% when news broke (although it recovered most of that lost ground a few hours later).

As of June 30, 2020, Cellnex had a total of 40,505 operational sites across Europe, plus 2,090 nodes (DAS and small cells).

Other lines of business include broadcasting infrastructures (16% of Group turnover) and solutions for "smart urban infrastructure management" (7%).

— Ken Wieland, contributing editor, special to Light Reading

About the Author(s)

Ken Wieland

contributing editor

Ken Wieland has been a telecoms journalist and editor for more than 15 years. That includes an eight-year stint as editor of Telecommunications magazine (international edition), three years as editor of Asian Communications, and nearly two years at Informa Telecoms & Media, specialising in mobile broadband. As a freelance telecoms writer Ken has written various industry reports for The Economist Group.

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