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Neuf Cegetel Reports 2005

Neuf Cegetel Reports 2005

May 10, 2006

2 Min Read

PARIS -- neuf cegetel is pleased to announce its financial results for 2005:

  • strong growth of revenues (+55%) from €1,178 million to €1,826 million (€2,752 million pro forma2005)

    - strong growth of adjusted EBITDA1 (+ 57%) from €162 to €255 million (€312 million pro forma 2005)

  • business mix increasingly well balanced between the group’s three segments, as shown by pro forma

2005 revenues by market:

  • €738m on the Mass Market, i.e. 27% of the total

  • €908m on the Enterprises market, i.e. 33% of the total

  • €1,106m on the Wholesale market, i.e. 40% of the total

    - adjusted net income2 of €9m, rapidly improving at the end of the year 2005

Growth driven by Data products for Mass Market and Enterprises

neuf cegetel’s two growth engines, Mass Market ADSL and Enterprises Data, fuelled revenue growth in2005 again.

  • Mass Market ADSL customers increased by more than 500,000 in 2005, as they had in 2004, toreach 1,172,000 at the end of 2005, i.e. a market share of 13%3. Over 2004-2005, neuf cegetelattracted 18%3 of all new ADSL customers and, in the first quarter of 2006, a further 157,000 joined,bringing the group’s total subscriber base to 1,329,000 at the end of March.

  • At the end of 2005, 103,000 Enterprises sites were directly connected to the neuf cegetel’s network,an increase of 41,000 sites over 2004. In the first quarter of 2006, a further 15,000 sites wereconnected, bringing the total to 118,000.Mass Market ADSL and Enterprise Data experience similar growth, based on the same economicand technical model.

The average monthly revenue excluding VAT (ARPU) is currently at €32 for Mass Market ADSLsubscribers and at €300 for Enterprise sites connected. Incremental revenues generated by the growth ofMass Market ADSL and Enterprise Data activities are therefore of the same order of magnitude.

These comparable dynamics are based on IP services and leverage the same full-IP network and similarequipments from DSLAMs to ‘boxes’ (neuf Box, 9 Pass and 9 Box office).Having built the densest unbundling footprint in France (network of 954 URAs operational at the end ofMarch with ADSL2+, VoIP and video), neuf cegetel is now able to optimize the gross margin of its Dataproducts. With 70% of the lines unbundled, Mass Market ADSL gross margin reaches 50% of revenues(and even 20€ per month for an unbundled line). Enterprise Data gross margin is already above 40% andis increasing, 60% of the new sites being unbundled (40% of the installed based).

Neuf Cegetel Group (Euronext: NEUF)

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