“We are at an epochal turning point in Tim's story as we know it." Tim's CEO said Peter Labriola in the aftermath of accounts in what will be remembered as "the last call of an integrated company", awaiting the new 2024-2026 industrial plan scheduled for Thursday 7 March. Labriola emphasized the progress made despite the challenges. “We have managed to improve the domestic business and lay the foundation for long-term structural growth, the direction is clear, domestic businesses are moving towards structural growth. There ServiceCo Domestic is well positioned to confirm this trend, not only economically but also financially”, added the CEO, speaking about the future after the sale of the network. At the end of the conference call with the analysts the title Tim grows by approximately 0,47% to 0,28 euros per share.
Labriola on the 2023 results: “Positive trend for the second consecutive year”
Tim concluded the 2023 with an extra gear, recording a increase in revenues by 3,1% to 16,3 billion euros, driven by the positive performance in both Brazil (+8,2%) than in domestic market (+1,2%), which is growing again after a long period. Despite an increase in net financial debt, which rose to 20,349 million euros, mainly attributable to operational dynamics, the preliminary numbers, approved by the board of directors, also highlighted an increase inebitda of 5,7%, reaching 6,4 billion euros, thus confirming "the positive trend for the second consecutive year", explains the top manager, underlining that "not many would have bet on it". The trajectory of domestic growth is "confirmed, the transformation plan has excellent execution, we have full cost discipline" which encourages us to go further. Furthermore, we have "collected 750 million in Pnrr funds, 4 billion have been refinanced, the delayering plan is in line with forecasts" and we are "really proud".
Labriola: "We will close the contract with KKR between June and July"
With regard to the netco, or the network company subject to theKkr offer with the Mef to be spun off, Labriola said he was calm about the closing of the operation. “This contract will be closed, we are close to the end, we are quite sure that will take place between June and July. The contract is binding, whatever happens to the management or the board of directors”, in view of the renewal of the board. The CEO then reiterated that he does not expect problems in the offices European antitrust. “To talk about concentration – he said – there must be two companies that concentrate, we are following the indications of the European Union which asked for a pure wholesale player” therefore “we don't see any particular problems”.
No dividend until the network is sold
There is no provision for Tim dividend not even for 2024, on the 2023 budget. “We will begin to evaluate the issue once the agreement” on Netco with KKR is concluded, declared the CFO Adrian Calaza. “We will see a clearer impact when we present the balance sheet results in a couple of weeks and the effect of the dividends received in Italy and Brazil will be reflected,” he added, also referring to the potential distribution of profit to savings shareholders .
A look at the future of telecommunications
Labriola glanced at the future of the European telecommunications market, after the EU's openness to a possible softening towards merger operations and consolidation in the field. “In the USA and Brazil they work well with only three operators, while in Europe we have over 100 operators and in Italy the market is particularly challenging. These numbers speak for themselves”, explained the CEO, according to whom it would be a step forward to revive a sector that has been in serious difficulty in recent years.
But what is Tim's role in this context? “We have to be ready. Until the Netco deal is done, we can do nothing but watch, but once it is done, we will be ready to play our part. The current situation is still evolving and we will have to remain flexible,” he concluded.
“In 2024 we are planning to do something with too kena, something different than other players, which is not linked to being aggressive in terms of pricing. On mobile - he added - we are defining a strategy that we will communicate in the coming weeks and on the occasion of the Capital market day" but "we do not want to accelerate price competition".
