Tim begins to see the finish line of the complex reorganization of the group under the guidance of the new CEO, Peter Labriola, who thinks of separate the network from commercial activities. The reorganization plan, which represents the industrial alternative to KKR's takeover bid project, now out of date, will be presented on July 7, on the occasion of the Capital Market Day. More than the quarterly accounts, approved yesterday, this is the main novelty that emerged from the last board meeting.
Before arriving at the reorganization, Tim will however have to overcome the last obstacles to sign the agreement with CDP for the realization of single network with Open Fiber and especially convince the KKR fund, which owns the 37,5% of Fibercop (Tim's secondary network), to sign the commercial agreement for sharing network infrastructure with Open Fiber in the so-called white areas.
The agreement negotiated between Tim and Open Fiber provided for a fee of about 200 million (190 euros per stake for over one million stakes), to be paid over a five-year period. With these payments, Open Fiber would save unnecessary investments (since building a pole from scratch costs around 300 euros) and would also share the costs of future maintenance with Tim. Also for Tim it is about more revenues and less costs.
However, Kkr would have contested the duration and value of the fee: if it were paid in two years, would allow Fibercop to obtain an extra return, and therefore to immediately distribute a dividend also to Kkr; in 5 years, on the other hand, would serve to finance investments. In theory, Kkr has veto power, but it would be unlikely to win any arbitration. Except that for Tim, time is money: for this reason, the company and the US fund should already meet tomorrow to seek an agreement.
Tim: First quarter accounts
Meanwhile, Tim archives the first quarter with revenues equal to 3,6 billion euros, down by 2,3% on the year. The EBITDA instead it stopped at 1,3 billion (-13,4%); that of the domestic business unit is equal to one billion euros (-18,3%), while that of Tim Brasil is 0,4 billion euros (+5,1 percent). The loss of the period attributable to the shareholders of the parent company amounts to 204 million euro, a slight improvement compared to the red of 228 million in the first quarter of 2021.
The revenue result is in line with the consensus expectations of analysts, while margins are slightly better (the expected decline was 14%). The trend of revenues and organic Ebitda for the quarter, specifies the Tim note, is in line with the forecasts of the business plan for the 2022 financial year.
THEnet financial debt after lease as at 31 March it stood at 17,7 billion euros, an increase of 1,1 billion euros year-on-year and by 0,1 billion euros compared to 31 December 2021.
THEnet financial debt, on the other hand, is equal to 22,6 billion euros, 1,5 billion more than in the same period last year and half a billion more than at 31 December 2021. Finally, the Equity free cash flow it is positive for 123 million euros on an after lease basis (301 million euros the equity free cash flow).
After the presentation of the accounts, CEO Labriola met Tim's managers to whom he underlined the importance of creating "an ecosystem favorable to the Plan".
According to Labriola, the quarterly, which shows "positive signals" such as those arriving from Brazil and some improving trends, "does not yet express" the value of the group, which will be able to "fully emerge from the Plan which provides for the focus on 4 businesses distinguished”: the Network, the Consumer with Small & Medium business, the Enterprise and Brazil.
