Cellnex keeps outlook after acquisitions boost H1 earnings

Cellnex Telecom has presented its results for the first half of 2022. Revenue amounted to €1.690 billion (+59%) and adjusted EBITDA grew to €1.282 billion (+59%) reflecting, together with organic growth, the effect of consolidating the assets the Company acquired in 2021. Free and recurring leveraged cash flow was €637 million (+62%).

The net result was negative at -€170 million due to higher amortization costs (up 67% compared to H1 2021) and financial costs (up 40% vs. H1 2021) associated with the consolidation and integration of acquisitions, and the consequent expansion of the Company’s geographic footprint.

Tobias Martinez, CEO of Cellnex, highlighted “a first half year marked by organic growth, which shows the strength of our business, and the consolidation of transactions carried out in recent months that keep delivering double-digit increases in revenue, EBITDA and recurring cash flow. This growth will continue to have a significant knock-on effect in 2022, when several of these operations will have been consolidated for a full year, and the sites we acquired from CK Hutchison in the UK are included as well.

“We will build on this growth,” said the Cellnex CEO, “through the partnerships we have established with our customers. Our commitment to invest up to €6.5 billion over the next 8 years to roll out some 22,000 new sites in the 12 countries where we operate for our customers is an example of this. In addition, we are also making progress on our Augmented Towerco model through the development and deployment of new Distributed Antenna Systems (DAS) and Small Cells, fibre to the tower, edge data centers, private networks for industry, connectivity networks for road and rail corridors, and the management of active equipment for mobile operators, as we are already doing in Poland.”

Business Segments: Key indicators for the period

• Infrastructure services for mobile telecommunications operators contributed 90% of revenue (€1.529 billion), up 70% on the same period in 2021. In that field, the company has renewed the contract with an anchor tenant renewed and extended for a 30-year period and industrial partnership including FTTT.
• The broadcasting infrastructure business contributed 7% of revenue (€112 million).
• The business focused on security and emergency networks and solutions for the intelligent management of urban infrastructures (IoT and Smart cities), contributed 3% of revenue (€50 million).
• As at 30 June, Cellnex had a total of 103,944 operational sites (not including the 22,000 sites planned for roll-out by 2030 and operations yet to be concluded): 4,509 in Austria, 1,473 in Denmark, 10,415 in Spain, 23,654 in France, 1,864 in Ireland, 20,699 in
• Italy, 4,073 in the Netherlands, 15,064 in Poland, 6,048 in Portugal, 7,996 in the UK, 2,764 in Sweden and 5,385 in Switzerland; in addition, there are 6,442 DAS nodes and Small Cells.
• The organic growth in points of presence at the sites was up 5.2% in relation to the same period in 2021, including the effect of the roll-out of new sites during the period.

Financial structure

Cellnex has a debt structure that is flexible, owing to the various instruments used.

The Group’s net debt –as at June 2022, excluding lease liabilities– was €14.3 billion. 86% of debt is at a fixed rate.

• In March the Company issued a bond for €1 billion.
• As at June 2022, Cellnex has access to immediate liquidity (cash and undrawn debt) of approximately €7.6 billion.
• Cellnex Telecom issues maintain Fitch’s investment grade rating (BBB-) with a stable outlook, confirmed in January. Meanwhile, S&P confirmed the BB+ rating with a stable outlook in March.

CT Bureau