Iliad has signed a €300 million loan deal with the European Investment Bank (EIB) to fund 5G rollout, shortly after the publication of Q3 numbers that showed a return to growth at its domestic mobile business.

The French operator said the loan will help finance mobile network rollouts in France as it looks to densify its 4G network and push on with 5G deployment. The loan is the latest in a series from EIB and brings the total amount of funding the bank has provided since 2009 to €1.1 billion.

Iliad, which disrupted the French establishment when it launched Free Mobile at the start of 2012 by piggybacking on Orange’s network, now describes network rollout as “an absolute priority.” It’s third-quarter results showed it covers 97.8% of the French population with 4G.

“We intend to pursue our rollouts at a brisk pace, particularly in view of the upcoming launch of our 5G offers and entry into the B2B market,” said Iliad’s group CEO Thomas Reynaud.

In Q3 Free Mobile deployed 550 new mobile sites in France and equipped close to 1,700 for 700 MHz spectrum. By the end of the quarter, on 30 September, its domestic mobile sites numbered 18,800, the vast majority – 17,700 – of which were 4G sites; 96% of those 4G sites are equipped for 700 MHz, Iliad said.

France’s operators picked up 700 MHz spectrum five years ago, and added mid-band 5G spectrum, 3.4 GHz-3.8 GHz. into the mix last month. Iliad paid €602 million for 70 MHz of frequencies.

Iliad’s focus on network rollout comes against the backdrop of Covid-19, which hit the telco’s mobile performance earlier this year. However, it’s Q3 numbers show that it is bouncing back.

Group revenues were up by 6.3% year-on-year to €1.42 billion, “despite a sharp drop in roaming revenues during the quarter,” Iliad said. France, which remains the main contributor by some margin, saw a 1.9% increase in turnover to €1.25 billion, driven by growth in mobile service revenues, which were up 2.4% to €537 million. Mobile ARPU in Q3 was up to €10.9 from €10.2 in Q2 and €10.3 in the year-ago quarter, while mobile customers grew to 13.5 million on the back of 70,000 quarterly net adds.

Looking at 4G mobile net adds tells a slightly different, but ultimately fairly positive story. Free Mobile added 120,000 4G customers in Q3, compared with between 100 million and 105 million in each of the previous three quarters. However, the operator failed to match its 147,000 million 4G net adds from Q3 2019.

In Italy, Iliad added 580,000 mobile customers in Q3, taking its total base to 6.84 million and driving a 56.3% increase in revenue to €171 million. Noteworthy, but not really comparable growth figures, given that the Italian business is only two and a half years old.

Back in France, Iliad is also talking up growth at its fixed business, primarily in fibre broadband. It added 299,000 new fibre broadband customers in the quarter to take its total base to north of 2.5 million. Meanwhile, in the overall broadband market it has 6.67 million connections, an increase of 99,000 between June and September, which it claims is not only its best performance since Q4 2012, but also the highest number of net adds in the market during the quarter, although it’s worth pointing out that that last point is an estimate.

It aims to have 2.8 million fibre customers by the end of this year and 5 million by 2024. It targets rolling out 22 million connectible fibre sockets by the end of 2022 and 30 million by the end of 2024, up from 18.2 million at present; it added 1.45 million in Q3.

Iliad shaved €100 million off its EBITDAaL less capex guidance for both the full year and full year 2021 last quarter, citing fibre customer growth. In Q3 it stuck to the this new target, predicting EBITDAaL less capex of €700 million this year and €900 million in 2021.

All that infrastructure rollout is a costly business.