- VodafoneZiggo records 1.5 per cent year-on-year revenue growth in the second quarter.
- Adjusted EBITDA grew 8.2 per cent compared to Q2 2023.
- VodafoneZiggo is on track to meet its financial targets for 2024.
VodafoneZiggo has had a robust second quarter. Compared to the same quarter last year, revenue increased by 1.5 per cent to €1.014 billion. Adjusted EBITDA rose 8.2 per cent to €482 million. With these results, the telecom company is fully on track to achieve its financial targets for 2024.
In the business segment, 4,800 internet connections were added in the second quarter, mainly in the small business segment. The fixed consumer market remains highly competitive, and the number of internet customers decreased by 27,400. The decrease is in line with the decline in the last quarter.
The number of mobile customers in the consumer market (post-paid) remained stable at 3.3 million customers. In the business market, the number of mobile customers decreased by 18,500 due to port-outs of local government contracts that expired in 2023. Despite this, revenue on business mobile subscriptions increased by 1.5 per cent compared to last year.
The number of so-called ‘converged’ customers combining products and services from both Vodafone or hollandsnieuwe and Ziggo remained stable at 48 per cent this quarter.
VodafoneZiggo saw an increase in average revenue per customer (ARPU) in the second quarter. For fixed services, the increase was 5.0 per cent, while for mobile services it was 2.6 per cent.
On 1 July, the company implemented the annual inflation adjustment for existing consumer and small business customers (SOHO). Prices rose by an average of 2.5 per cent. This is well below the CBS inflation rate, set at 3.8 per cent over 2023.
Adjusted EBITDA
Adjusted EBITDA increased for the second quarter in a row. The growth of 8.2 per cent was driven by a higher gross margin and lower operating expenses, including energy costs, compared to the same quarter in 2023. For the whole of 2024, VodafoneZiggo is expected to achieve a low, single-digit EBITDA growth compared to 2023.
Investments
Investments (CAPEX) amounted to 23.3 per cent of revenue in this second quarter. Among other things, VodafoneZiggo invested in the further rollout of the media box Next Mini and SmartWifi Pods. The company also invested in its networks and in expanding its video platform for the more than 500 European football matches to be broadcast from September.
Entertainment strategy
Ritchy Drost, CFO and interim CEO of VodafoneZiggo looks back on the second quarter with satisfaction: "We see quarter on quarter a very competitive telecom market with a lot of deep price and product promotions. This is offset by our entertainment strategy and the excellent price/quality ratio of our products. Moreover, we continue to invest in our networks, products, content and services."
Operational highlights second quarter
In the second quarter, Vodafone Group Plc and Liberty Global Ltd announced that Stephen van Rooyen has been appointed as the new CEO of VodafoneZiggo. Van Rooyen was the CEO of Sky UK and Ireland and chief commercial officer for Sky Group. He brings with him more than 20 years of experience in media and telecoms. Van Rooyen will start on 1 September 2024.
In addition, VodafoneZiggo recently won a major central government tender for mobile communications. The contract runs for six years and includes all ministries, executive organisations and judiciary bodies.
Preparations for more than 500 live broadcasts of UEFA European club football are on schedule. The Ziggo GO app for non-customers is live, the first football fans have signed up and the first practice matches have been broadcasted. Also, Ziggo Sport has now built a new, state-of-the-art studio for all broadcasts.
At the same time, the sports channel renewed the exclusive MotoGP rights for the Netherlands. Ziggo Sport signed a new agreement with rights holder Dorna Sport S.L. for five years.
To further improve the customer experience, VodafoneZiggo customers can now use the new, integrated Vodafone & Ziggo app. In one central place, they will find all the information about products, bills and services. In addition, customers will find tips on films, series and TV programs in the app and can click through to the Priority offer. This gives them priority and benefits at concerts, sporting events and outings, and allows them to take part in competitions. It is also possible to chat with customer service 24/7. If there is an unexpected outage, a notification follows in the app.
hollandsnieuwe's app was also made more intuitive, faster and user-friendly. In addition, the app was given a new, fresh design. Customers can now change their bundle even more easily. Upgrading call credit is also much easier.
VodafoneZiggo secured 100MHz in the 3.5GHz band in the recent 5G frequency auction. The new spectrum offers more capacity and shorter response times. This will allow the telecom company to further develop the existing 5G network to support customers' current and future needs. The new licence runs until 2040. VodafoneZiggo paid €57.5 million.
An example of innovation on Vodafone's 5G network is the pilot the telecoms company conducted during the Nijmegen Four Day Marches (Vierdaagse). Thanks to network slicing from Vodafone Business, emergency services were given priority on the network even during peak traffic. This contributes to visitor safety during major events.
Last quarter, VodafoneZiggo and nlgroeit announced a partnership to help entrepreneurs with growth and innovation through advanced technologies and knowledge exchange. Together, the parties aim to inspire and raise awareness of growth opportunities, stimulate investments and facilitate entrepreneurs with events and content.
Other partnerships also stood out in the second quarter. During Utrecht Pride and Groningen Pride, the focus was on connection. As main sponsor, VodafoneZiggo therefore introduced the Belong(r)ing, a powerful symbol of connection and an easy conversation starter during both events.
Finally, VodafoneZiggo renewed its main sponsorship with Ajax this quarter. The current contract expires in 2025; the new one lasts until mid-2027, with an option to extend it until mid-2029. The partnership focuses on visibility around matches and entertainment. In addition, partners will develop social projects together. For instance, there will be a follow-up to Silence Social Hate, last year's successful campaign against hate speech on social media.