Iliad profits grow as it looks across to Italy

It’s easy to get distracted by the whole Vivendi/TIM saga, but Iliad is another French business looking towards the land of pizzas, Vespas and slicked back hair for future fortunes.

Looking at the financials first, the French telco had a positive 12 months adding just short of one million subscribers to take its total market share up to 19% of the French market. On the broadband side, the business is looking pretty positive as well. Iliad currently boasts of 6.5 million broadband subscribers, 556,000 of which are FTTH, up from 310,000 at the end of 2016. Looking at the spreadsheets, total revenues for the year increased to €4.987 billion, a year-on-year increase of 5.6%. Not bad.

Iliad is a company we rarely speak about in the UK, partly because Orange is a more dominant player on the wider European space and the Vivendi/TIM situation is too unusual to pass on, but these are some pretty solid results. After disrupting the market with its Free Mobile offering, the telco is showing it wants more than 15 minutes of fame with its investment plans as well. FTTH plans are continuing to develop as 6.2 million homes are now fibre connectable, up two million compared to 2016, while the team claims to have 4G coverage of 86% of the French population.

Over the next 12 months the team plan to open another 2000 new sites, driving 4G coverage up to 90% of the population and 3G to 95%, while also finalizing the migration of 4G sites to 1,800 MHz. In the broadband business, the aim is to increase the FTTH subscriber base by 300,000 to 500,000 and have 9 million connectible FTTH sockets by the end of the year.

Aside from consolidating its position in the French market, Iliad has also ramped up plans to become Italy’s fourth mobile operator before the summer. 2017 was a year of planning and organization, the team hired 80 employees, put in place a management team and €220 million paid to the Italian government for the re-farming of 1,800 MHz frequencies, but 2018 is the year to make some noise.

The next couple of months could make the Italian market a very interesting place, with Iliad planning to achieve an EBITDA break-even in Italy with less than 10% market share and also the separation of the fixed network business from TIM. With Vivendi/TIM looking to capitalise on the media market to turn a profit and Iliad possibly aiming to use the same strategy which brought success in France, it could be a perfect mixing bowl of chaos.

Elsewhere in the French market, Altice has announced it has entered into an exclusive agreement to sell its international wholesale voice carrier business to Tofane Global. The announcement is part of a wider Altice strategy to remove any non-critical assets from the portfolio.