Latest quarterly figures show profits and ambitions rising
French telco Iliad has reported a rise in operating profit in its first quarter of 2022, up 5.4% from a year earlier, driven by higher revenues in both France and Italy. Earnings before interest, tax, depreciation and amortisation after leases grew to โฌ714 million euros ($755 million) in that time, Iliad said in its quarterly financial statement, which also showed that its first-quarter sales rose by 4.8% to โฌ1.9 billion.
Nil desperndum
Iliadโs owner Xavier Niel took the company private last year through a โฌ3.1 billion buyout. Niel has repeatedly emphasised a mission to grow aggressively in the three countries, France, Italy and Poland, in which it operates. On entry to the Italian market in January 2022, the telco set about undercutting rivals. It adopted the same strategy for 5G as in its domestic market โ undercutting competitors at launch.
Disrupteur
Iliad had launched a highly disruptive strategy in France in December 2021. In a similar vein Iliad Italia launched a 5G package on 22 December, called Flash 70, in Italy for under โฌ10 for a limited period. In February Iliad made an โฌ11 billion bid for Vodafoneโs Italian operation, which at the time was rejected by Vodafone Group CEO as โnot in the best interests of shareholdersโ. Since analysts at Barclays estimated Vodafoneโs Italian business to have an enterprise value of โฌ6.9 billion, there is speculation that this deal may be under consideration again.
Polish spirit
Iliad Poland is a relatively recent addition in September 2021. It was acquired from the countryโs fixed internet operator UPC which was owned by US cable operator Liberty Global. In June 2021 UPC Polandโs network had passed 3.7 million homes and served 1.5 million broadband and 1.4 million video customers, and more than 600,000 telephony subscribers.
Organic growth
โOur priority remains to grow organically,โ chief executive Thomas Reynaud said, adding that the group was open to acquisitions. โIf a consolidation were to take place (in Italy) and if a player were to sell its Italian asset, we would look into it,โ Reynaud said on a results call. In Italy Iliad is seeking to reach a deal with rival Wind Tre in Italy to share the costs of the rolling out of their mobile network. Its rival, national carrier Telecom Italia (TIM) recently clinched an infrastructure share deal with Open Fibre to give it more competitive costings.
Wind Tre
Reynaud said in March that Iliad was close to a deal with Wind Tre, owned by conglomerate Hutchinson. Iliad rents capacity from Wind Tre where it lacks coverage and formed a partnership with broadband provider FastWeb to build its 5G network. Talks are still ongoing and a transaction has not yet been finalised, a spokesperson for Iliad said. Wind Treโs Jeffrey Hedberg moved over as CEO on April 1st 2022 but serves on the board.