Telefonica will earn 989 million by September and confirm all its financial goals

Telefónica earned 989 million euros between January and September 2024, 21.7% less than in the same period of the previous year, according to information it registered this Thursday with the National Securities Market Commission (CNMV ). The company’s financial performance was affected by the significant impact of exchange rates on cash flow, which amounted to €25 million during the period, despite the company’s hedging arrangements.

As a result of currency movements, revenues for the third quarter decreased by 2.9% to EUR 10.023 million. In total, over the nine months they reached 30.418 million, which is 0.4% more than in the same period last year. Of this, 60% of quarterly revenue comes from the housing market (B2C); 21% from the business segment (B2B); and the remaining 19% corresponded to wholesale business, partners and other income.

The company confirms that these results allow it to “confirm all of its financial targets for the full year 2024.”

The currency exchange effect also impacted operating results before depreciation and amortization (EBITDA). In the third quarter, it fell 2.5% quarter-on-quarter to €3.260 million. In the first nine months of the year, the operating result before depreciation and amortization reached EUR 9.684 million, up 0.4% compared to the previous year.

In accordance with the company’s plan, investments amounted to 12% of revenues, reaching 3.642 million euros, which represents a decrease of 4.8% compared to the same period of the previous year. At the same time, debt, one of the indicators to which analysts attach the most importance, stood at 28.748 million euros at the end of September, which is 8.3% more than in the same month in 2023.

The company confirmed that these results allow it to “confirm all of its financial targets for the full year 2024.” Among those goals is ending the year with revenue growth of about 1%. For operating result (Ebitda) growth remains from 1% to 2%, and for operating cash also from 1% to 2%. They are expected to have an investment over income ratio of up to 13% and an increase in free cash flow of more than 10%.

These results enable Telefonica to confirm all of its financial targets for the full year 2024. These goals include revenue growth of approximately 1%, EBITDA of 1% to 2% and operating profit also of 1% to 2%, which is an investment target. with an income of up to 13% and an increase in free cash flow of more than 10%.

In the commercial space, the company ended September with 393 million hits, up 2%. The number of contract fiber and mobile customers continues to grow by 11% and 3% respectively compared to September 2023.

“Our GPS action plan is ambitious and continues to deliver results, moving us in the right direction and consolidating profitable growth. In the first nine months of the year, amid global uncertainty, Telefónica generated a profit of almost one billion euros and confirmed all of its financial targets for the full year. In addition, we are confirming shareholder compensation for 2024. We continue to transform networks using a strategic approach based on quality and power, and do so with higher customer satisfaction. The opportunity is enormous and Telefonica will continue to leverage its resources to drive growth in service of our shareholders and customers,” says Telefonica President José María Álvarez-Pallete.

For these shareholders, Telefonica has also confirmed 2024 shareholder compensation of €0.30 per share, to be paid in two tranches in December 2024 and June 2025.

By country, Telefonica Spain’s EBITDA returned to growth path, rising 1% in the third quarter to €1.155 million and up 0.6% in the first nine months to €3.387 million.

This evolution takes place in a context characterized by accelerating commercial growth, with the highest net increase in clients in Spain in six years; due to greater customer satisfaction: NPS (“Net Promote Score”) amounted to 34 points, which is 2 percentage points higher than in June; and for greater loyalty, with 0.8% churn, the lowest level in history. In addition, the average revenue per customer (ARPU) remains above 90 euros.

In Germany, EBITDA rose 3% in the quarter to €694 million and 3.9% in the January-September period to €2.027 million. Customer loyalty in the German market has also improved, with churn down to 1%.

In Brazil, it was the destination where operating results fell the most. In particular, in the last quarter alone it fell by 5.9%.

In the UK, VMO2 confirmed its financial targets for the full year, a commitment that includes the distribution of dividends to shareholders, while Hispam maintains its strategy to reduce capital exposure in the region and continue to operate more efficiently. lower costs.