VodafoneZiggo's financial results for the past quarter are as expected. Customer growth was again achieved in both the mobile and fixed business markets. The revenue is more or less stable compared to the same quarter last year. VodafoneZiggo also confirmed after this quarter that it will meet its 2023 financial guidance.
The number of mobile subscriptions continues to grow and VodafoneZiggo also managed to gain new customers in the business broadband market last quarter. In the consumer market, we see strong competition between high-speed internet providers. As a result, the number of households buying television, internet and telephony from Ziggo declined slightly this quarter.
When presenting its 2022 annual results, VodafoneZiggo already expected that this year's EBITDA would decline due to higher operating costs of around €100 million. The EBITDA was €445 million for the last quarter on a total revenue of €999 million. This is down 3.6% compared to the second quarter of last year. With this, VodafoneZiggo realised an improvement compared to the first quarter of 2023 which reported an 8.2% decline.
Causes are inflation-driven higher energy costs in the market and the cost of implementing the CLA for employees concluded at the end of last year. VodafoneZiggo is sticking to the target set at the beginning of the year regarding EBITDA development.
VodafoneZiggo reinvested 23.6% of revenue in networks, products and services in the last quarter.
CFO Ritchy Drost: “VodafoneZiggo is on track to meet its 2023 financial guidance. Revenue remained stable compared to the same quarter last year at exactly 999 million. The reported Adjusted EBITDA fell slightly, which was a direct consequence of the higher energy and salary costs. The decline in the last quarter was 3.6% - a big improvement on the first quarter.
We remain focused on executing our strategy through adding value to customers. VodafoneZiggo does this by consistently investing at a high level in our networks as well as in customer experience. Both on the Vodafone mobile network and the Ziggo fixed network. Both networks are world-class. Our customers also have the best range of content in the Netherlands.
The successful test of Docsis 4.0 in the last quarter is also the result of our investment strategy. As of late last year, we have been the first provider to offer a nationwide 1 Gbit/s network with 7.3 million connections. We want to provide the speed and network capacity our customers need well into the distant future - without having to dig up streets to do so.
We also take providing Endless Entertainment and viewing pleasure to our customers seriously. Thus, we have added both Pathé Thuis and SkyShowtime to our range. Ziggo Sport is the leading sports channel in the Netherlands for all sports fans. We extended our existing rights and brought in new rights. Such as Portuguese football, Belgian football but also the European Handball Championship for men and women.”
Highlights of the second quarter
VodafoneZiggo's share of the business market is growing for the tenth quarter in a row: within the B2B portfolio, a revenue growth of 2.1% was achieved in the second quarter of 2023 compared to 2022. VodafoneZiggo continues to grow in the SOHO and SME customer market.
The total number of Ziggo customers in the consumer market declined slightly last quarter, again partially offset by new customers in the business broadband internet market. In the consumer market, VodafoneZiggo served 35,400 fewer fixed internet customers, while adding 4,400 business customers. This brings the net decrease to 31,000. VodafoneZiggo has over 3.3 million customers for internet and 3.6 million customers with television via the Ziggo network. 1.7 million customers still use fixed telephony.
The number of so-called ‘converged’ customers combining both Vodafone and Ziggo products and services increased slightly in the second quarter. The number of Ziggo customers who also have a mobile subscription with Vodafone totalled over 1.5 million. Meanwhile, 47% of households with a Ziggo subscription are also Vodafone customers.
Mobile revenue in the consumer market grew 3.3% compared to the second quarter a year earlier. This is mainly due to increasing customer numbers. Revenue per customer (ARPU) also increased slightly by 0.8%.
The total number of post-paid mobile SIM cards increased by 38,000 like the last quarter, of which 23,000 were in the business market. VodafoneZiggo therefore has over 5.5 million customers for its mobile services.
Faster internet since May
Ziggo's internet grows with customer needs. Since May 2023, customer upload speeds have therefore increased by 40-50%. This is because customers are increasingly working and gaming online from home, for example.
Endless entertainment: SkyShowtime, Pathé Thuis and Pro League
Ziggo offers SkyShowtime on Ziggo's TV platform. Customers can subscribe and watch all the films and series on the Mediabox Next and Next Mini. Ziggo customers enjoy new and exclusive films and series via SkyShowtime, including the latest cinema releases from Universal, Paramount and other leading series.
Through Pathé Thuis, Ziggo is expanding its rental film offering from 800 to more than 5,000 films, which are immediately available to Ziggo TV customers with a Mediabox Next Mini, Next and XL. Pathé Thuis thus offers movie lovers access to the world of film from the comfort of the couch in their homes. Since customers pay per film, a subscription is not necessary.
The extension of the contract with the Belgian Pro League means that this football league can be seen exclusively on Ziggo Sport, the leading sports channel in the Netherlands, at least until the 2024/2025 season.
Successful test of Docsis 4.0
VodafoneZiggo has over 40,000 km of fibre-cables nationwide. Most of the distance travelled by internet data passes through this network. The final leg to the customer is via cable. VodafoneZiggo has been using DOCSIS technology for this for many years. This technology already allows Ziggo to offer speeds of up to 1 Gbit per second nationwide. In May 2023, VodafoneZiggo conducted a successful trial of Docsis 4.0 - the latest available version. This upgrade will allow the capacity and speed of the Ziggo network to increase even further in the coming years. This will become available to customers in the coming years, allowing VodafoneZiggo to deliver the internet speed customers need well into the distant future.
Huiskamer van Toen
One of VodafoneZiggo's most eye-catching initiatives last quarter was the launch of the Huiskamer van Toen (Living Room of the Past). Various entertainment highlights from 70 years of TV history are projected on the walls, such as NASA's 1969 moon landing, sketches from 1970s show De film van Ome Willem and the European Cup ceremony in 1988. The Huiskamer van Toen visits residential care homes to give elderly people a fantastic day. The living room symbolises what modern technology can do for the elderly - for whom its use is sometimes challenging. Those who want to can take a special class on how to take, save and send photos, with the elderly getting help using their mobile phones.
