Belgacom sees 2015 as 'tipping point' en route to growth

Belgacom provided its first positive financial outlook since 2010 for the coming year, saying that its underlying revenue and EBITDA would remain stable or grow slightly in 2015.

"We believe the year 2015 will be the tipping point within our track to growth," said CEO Dominique Leroy, who added that the Belgium-based operator also achieved its revenue and EBITDA guidance for 2014.

However, analysts had a less positive view of the company's performance in the fourth quarter of 2014, noting that Belgacom missed EBITDA forecasts in the period. EBITDA fell by 4.7 per cent in the fourth quarter to €380 million ($426 million), which Reuters said was below the €390 million expected in a poll of nine analysts.

Jefferies analysts also commented that they found the 2015 revenue and EBITDA outlook "ambitious", noting that the company's trading environment could worsen in 2015. "We note that competitor results suggest that some have stepped away from the fray in 4Q" in the face of Belgacom's onslaught, the analysts said.

Reuters noted that the market consensus is for a decline of revenue and core profit this year, according to Thomson Reuters Starmine data.

Indeed, 2015 could also see Orange's unit Mobistar return to the multi-play market--a strong focus of Belgacom. The rival mobile operator is in the process of re-entering the fixed market by taking advantage of new regulations forcing cable operators to open their networks.

In 2014 as a whole, Belgacom reported a 1.6 per cent decline in underlying revenue to €5.8 billion compared to 2013. The operator ended 2014 with underlying EBITDA at €1.6 billion, which was 2.5 per cent lower than for 2013. Including the net gain on disposed companies and building sales, group EBITDA was €1.7 billion, 3.3 per cent higher than for 2013. Thanks to the higher reported EBITDA, including net gains, net income was up 3.8 per cent on the previous year at €654 million.

"Especially in the fourth quarter we saw good growth in our customer base thanks to a successful year-end campaign launched under the new Proximus brand. As a result, we have closed the year with a higher market share for mobile, digital TV and fixed Internet," observed Leroy.

Belgacom started to sell all of its services under the Proximus brand in October last year.

For more:
- see Belgacom's 2014 and Q4 2014 results statement
- see this Reuters article

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