Telenet.be
 
 
 
 

Investment Proposition

 
 

Outlook

Outlook

2022 will be a pivotal year for Telenet, in which we aim to complete two major strategic overhauls. Firstly, we continue to engage in constructive discussions with Fluvius on the data network of the future in Flanders. Both companies target to enter into legal agreements by the time we report our H1 2022 results, which represents a slightly delayed timing versus spring initially. In addition, we intend to host a Capital Markets Day shortly thereafter to provide more clarity on the growth outlook for both our retail and infrastructure businesses. Secondly, we announced the sale of our mobile telecommunications tower business to DigitalBridge at the end of March for a total cash consideration of €745.0 million, equivalent to a multiple of 25.1x EV/EBITDAal 2021. As part of the agreement, Telenet will enter into a long-term Master Lease Agreement (“MLA”) with DigitalBridge, which includes an initial period of 15 years and two renewals of 10 years each. The agreement also includes a build-to-suit (“BTS”) commitment to deploy a minimum of 475 additional new sites with Telenet acting as a subcontractor to TowerCo, resulting in additional proceeds to Telenet over time. The transaction is expected to close in the second quarter of 2022 and does not require any further regulatory approvals. As a result of this landmark transaction for Telenet, we intend to move to EBITDAal reporting from the second quarter of this year and will provide rebased FY 2021 and YTD 2022 headline financials in order to facilitate a like-for-like comparison base, including an update of our FY 2022 outlook to reflect the transaction impact on our key financial metrics.

Having completed the first three months of the year, we reconfirm our full year 2022 outlook as presented mid-February. Relative to the first quarter, we expect an improved trend in both our revenue and Adjusted EBITDA performance in the second half of the year, driven by certain price adjustments coming into effect as of mid-June 2022 as announced yesterday, as well as a continued focus on our operating expenses and tight cost control.

1EBITDAal referred to as EBITDA after leases

OUTLOOK FY 2022 As presented on February 10, 2022
Revenue growth Around 1%
Adjusted EBITDA growth (a) Around 1%
Accrued capital expenditures as a percentage of revenue(b) Around 25%
Adjusted Free Cash Flow (a, c) Flat versus FY 2021
(FY 2021: €404.9 million)

(a) Quantitative reconciliations to net profit (including net profit growth rates) and cash flows from operating activities for our Adjusted EBITDA and Adjusted Free Cash Flow guidance cannot be provided without unreasonable efforts as we do not forecast (i) certain non-cash charges including depreciation and amortization and impairment, restructuring and other operating items included in net profit, nor (ii) specific changes in working capital that impact cash flows from operating activities. The items we do not forecast may vary significantly from period to period.

(b) Excluding the recognition of the capitalized football broadcasting rights and mobile spectrum licenses and excluding the impact from certain lease-related capital additions on our accrued capital expenditures.

(c) Assuming certain payments are made for the temporary prolongation of our current 2G and 3G mobile spectrum licenses in 2022, yet excluding payments on any future spectrum licenses as part of the upcoming multiband auction, and assuming the tax payment on our 2021 tax return will not occur until early 2023.