VodafoneZiggo has performed well during the third quarter. The total revenue increased by just under 2% and our operating profits grew by over 2%. In short, the company is on course to achieve the financial objectives for 2021.
The good momentum continued in the third quarter, with strong mobile customer growth, an increase of the FMC penetration, and a broadly stable broadband customer base. The number of households that are customers of both Vodafone and Ziggo is still growing considerably. This proves that the so-called converged strategy is working. Customers who combine their fixed and mobile services are more satisfied and stay with the company for longer.
Customers remain the biggest focus for VodafoneZiggo. Customers expect high-speed and stable connectivity, wherever they are, and regardless of the technology used. That is why VodafoneZiggo continue to invest in their customers by realizing a Dutch Gigabit society, with the 1 Gigabit national roll-out program, nationwide 5G coverage, new SmartWiFi pods to maximize the in-home customer experience, a dedicated WiFi Crew, and ever faster internet speeds. These investments translate into a rising Netto Promoter Scores.
Highlights for Q3 2021:
- Robust commercial performance:
- Fixed Mobile Convergence (“FMC”) gained further traction with 49,000 converged. SIMs and 9,000 converged households added, driving improvements in Net Promoter Scores (“NPS”) and reduced churn. FMC households have, on average, 10 points higher NPS and are 50% less inclined to churn compared to non-FMC households in the quarter
- Added 67,000 mobile postpaid SIMs, bringing the YTD total to 184,000 net additions
- Delivered 3% fixed ARPU growth. Total internet RGUs of 3.3 million, declining 10,500 or 0.3% in the quarter
- Strong financial growth and cash flow generation:
- Revenue grew 2% YoY, marking our tenth consecutive quarter of growth, primarily driven by mobile customer base growth, roaming and visitor recovery, and fixed ARPU growth
- Net loss remained stable YoY at €21 million, as higher gains on our derivative portfolio fully offset higher foreign currency exchange losses and lower operating income
- Adjusted EBITDA increased 2% YoY to €490 million, driven by revenue growth and cost discipline. Adjusted EBITDA margin increased 0.3pp YoY to 47.9%
- Adjusted EBITDA less P&E Additions increased 9% YoY to €324 million, driven by lower property and equipment spend and Adjusted EBITDA growth
- Continuously improving customer experience:
- 2.2 million customers received a free modem software upgrade, enabling Mesh WiFi technology to optimize in-home connectivity
- New, network integrated, high-end SmartWiFi pods launched to help deliver in total 1 million Mesh WiFi pods to our customers by the end of 2021
- Over 60% of our connected households are now upgraded to 1 Gbps internet speeds, including 1.2 million new customer homes added in the third quarter. Nationwide coverage planned for 2022
- 2021 guidance updated:
- Around 2% Adjusted EBITDA growth (previously 1%-3% growth)
- 19%-21% of property and equipment addition as % of revenue (unchanged)
- At least €600 million cash distribution (previously €550 - €650 million)
