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  1. #1
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    [EN] Iliad: Budget Billionaire Learns How to Spend It

    Iliad's expansion in France has meant more network investment, and its coming move to Italy will add to the bill.

    Leila Abboud
    March 7, 2017

    When Xavier Niel was building low-cost French telecoms group Iliad SA, his competitors accused him of being a free-rider who merely resold capacity rented on their networks. That critique, while valid a few years ago, is no longer apt.

    The billionaire has turned into a big spender on fiber and mobile networks. Iliad has been building mobile infrastructure in France from scratch since 2012 and has grabbed an 18 percent market share. It still relies on bigger rival Orange SA to carry much of its mobile traffic, but that dependence is lessening as the network nears completion.

    Young Gun

    Iliad spends more on network investments as a percent of sales than larger peers



    This shift away from an asset-light model has implications, of course. The total returns on Iliad shares have handily beaten the Stoxx 600 index in the past decade, delivering an annualized increase of 12.9 percent (with dividends reinvested), compared to 3.7 percent for the index. Yet the company has also only generated positive free cash flow in four of the past 13 years.
    Odyssey

    That's very different from larger, more mature telecoms operators that throw off lots of cash and often use it to pay attractive dividends. Of course, skinny dividends won't matter to Iliad investors when it's growing so quickly.

    Revenue last year rose 7 percent to 4.7 billion euros ($5 billion) and Ebitda increased 12.5 percent to 1.7 billion euros. Its mobile service in France, which didn't exist five years ago, brings in nearly half of revenue. This is a performance any European or U.S. telecoms boss would drool over.

    But the growth carries a price. Iliad's capital expenditure hit its highest level last year, totaling 1.3 billion euros, and another 472 million euros was spent on mobile spectrum. Iliad is spending to close the quality gap of its French mobile network to rivals Orange and Bouygues SA and to connect more homes to fiber broadband.

    To try to ease concerns on how much it's having to fork out, Iliad has offered a little more clarity. It said it would spend 1.4-1.5 billion euros per year on capex in 2017 and 2018, excluding spectrum. It even set a target related to cash generation for the first time, pledging to create 1 billion euros in Ebitda minus capital expenditures from 2020. Much of the promised cash boost will come from lower fees paid to Orange once Iliad has more of its own capacity.

    Watch out though: these promises apply only to France. Details are more scarce on the cost of Niel's foray into Italian telecoms. Iliad says it can break even in Italy on an Ebitda level with less than 10 percent market share. On Tuesday, it predicted 100 million euros of Italian capex this year, which will "go up from there".

    Build-Out

    Iliad's expansion in France has meant more network investment, and its coming move to Italy will add to the bill



    One item in Italy has already turned out more costly than expected. Iliad bought some mobile spectrum from Hutchison and Vimpelcom's Wind for 450 million euros. But it's just disclosed that it'll have to pay another 240 million euros to the Italian government to renew the spectrum licences.

    Such an outlay won't make or break the Italian adventure, which will be paid for largely by taking on more debt. Still, Italy's a very different place to France. Mobile prices there are already pretty low, while many people aren't stuck on the kind of long-term contracts that the French had to suffer before Niel tore up the market.

    Iliad has won fans as a rare growth story in European telecoms. Italy will show whether its increased maturity comes at a cost.

    https://www.bloomberg.com/gadfly/art...ow-to-spend-it

  2. #2
    WHT-BR Top Member
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    Dec 2010
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    ICYMI: Iliad's Achilles Heel

    Leila Abboud
    Aug 31, 2016

    Billionaire Xavier Niel is one of the most aggressive telecoms bosses in Europe, feared for his low-cost model that laid waste to the profits of his French competitors.

    Started as a broadband provider in 1999, Iliad surfed the opening of the French market to competition to become a company with a market value of almost 11 billion euros. The stock has trounced the European telecoms index since its IPO in 2004, earning Niel plaudits from investors.

    But on one key measure, Iliad has been a long-time laggard: free cash flow generation. The company has delivered positive consolidated free cash flow in only four of the past 12 years.

    ...

    Artigo completo: https://www.bloomberg.com/gadfly/amp...free-cash-flow

  3. #3
    WHT-BR Top Member
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    Dec 2010
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    Entre os vários empreendimentos de Xavier Niel temos a Online.net, que utiliza multiplas instalações da Iliad Datacenter.

    Em 2009, a Online.net agregou a Dedibox, fundada em 2005 por Arnaud de Bermingham e atual CEO e CTO.

    Xavier Niel alegadamente ajudou Octave Klaba no inicio da OvH.

  4. #4
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010
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    17,190




    Xavier Niel‏ @Xavier75 1 hour ago

    Free abolishes roaming charges: unlimited calls/texts & 5GB/m inc. all year in 35+ countries in the €15.99 plan!

  5. #5
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010
    Posts
    17,190

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