METROWEB CAN WAIT. TELECOM ITALIA DOES IT BY ITSELF. MORE INVESTMENTS, LESS DEBTS. ALSO THANKS TO THE TOWERS
Doctor Patuano, shall we take stock of Oì? “There's no space on my desk for Oì” replies the CEO of Telecom Italia Marco Patuano. “It's all covered by the documentation of the three-year plan”. Where are we on the Metroweb front? "There is no yes or no answer - replies Patuano - Let's say that we will make 40 cities Fiber to the Home", that is, using the same technology adopted by Metroweb. “a dossier – adds the president Giuseppe Recchi – on which there was excessive expectation” And now? “To date there is no evolution on that side”.
"It's a particular situation - commented Patuano in front of the analysts gathered at the City - the group hasn't made so many investments for a millennium and we find the situation of having to face this situation in which we almost seem like a threat is strange, it's strange". In this affair, added the CEO, there has been too much dogmatism and instead we need to be pragmatic. “Discussing industrial issues in the spotlight or with a lot of noise is something that doesn't help”.
And again: “If Metroweb is removed as a vehicle, the discussion must be different: are you interested in accelerating investments with good economic returns in a phase in which fiber must get closer to the customer? The answer is yes". And if "there is the possibility of having a creation of value with different combinations, we will evaluate them, but now we do not want to block the work of our technicians focused on our investment plan". In short, Telecom retreats to the Aventine or, if you prefer, to the shore waiting for news.
In the meantime, as far as the Italian market is concerned, great hopes are pinned on the forthcoming start of the partnership with Sky, starting in April. "Our goal is to bring broadband customers from mobile to landline and expand the landline with the offer of video content that will be the same as the Sky platform". The potential market share consists of 14 million users potentially interested in pay TV.
No interest, however, for the possible consolidation of the mobile telephony market. Any mergers, added the CEO, would not be a good remedy for the strong competition that has affected margins. Telecom, however, has no intention of continuing the price war that has characterized the Italian fixed and mobile telephony market in recent years, a trend that has led to a progressive contraction of margins. “If someone intends to offer rates lower than what we consider to be the minimum level, they will certainly guarantee the customer. But it doesn't seem like the best way to stay on the market."
No news on Tim Brasil either. “if someone arrives who believes that Brazil may have more value than we attribute to a strategic stake and is willing to put a higher value on the table than that of the stock market, we are willing to sit down at the table”.
Also on this front, therefore, no shocking news has arrived from the London meeting with the financial analysts of Telecom's top management. And this, together with the news that the dividend will be allocated to savings shares only (2,75 cents, as financial director Piegiorgio Peluso "informally" anticipates), justifies the cold but not too much reception of the market: the share, despite its decline, has hold above the recently reconquered barrier of one euro. In a difficult context, however, the board has given a boost to the investment plan: 14,5 billion over the next three years (10 billion for Italy, the rest for Brazil) of which 3 for the development of optical fiber ( plus 1,1 billion) which at the end of 2017 will have to serve 75 percent of the Italian population while the 4G network will even reach 95 percent of the domestic market. All without compromising the financial situation (debts today amount to 26561 million). In Telecom's plans, the ratio between net financial debt and Ebitda should drop to 2,5 times from the current 3. This is also thanks to the listing of the Towers (expected before the summer) and various operations on real estate assets.
Pending news on the equity front, the board probably couldn't do much more. “We have a history of organic growth” Patuano pointed out, leveraging on corporate pride, adding that “above all, I want to continue deleveraging: I'm obsessed with this”. And then, he underlined: "When you have a 14,5 billion investment plan to make, it's not that you get bored ... right now I've asked my collaborators to focus on the organic component". There is still time for great designs and adventures.
