Numericable posts loss on SFR costs, details fibre plans

Numericable’s LaBox Fibre

Numericable posted a third quarter net loss of €94.4 million, compared with a profit of €12.8 million last year as the acquisition costs of larger rival SFR took their toll. However the group said that without the SFR costs it would have generated a net profit of €121.4 million for the first nine months, against an actual loss of €177.8 million.

Numericable’s quarterly sales year-on-year rose 4% to €331.7 million.

Speaking on a conference call on the results, CEO Eric Denoyer said that Numericable is benefiting from a growing focus on the fibre broadband segment, in competition with Orange.

Numericable plans to will reach 17 million homes with fibre by 2017 but will concentrate on FTTH in areas where it does not have cable plant already, said Denoyer. The company will not deploy FTTB in areas where it doesn’t have cable networks already in the ground.

Questioned on press reports that he has been identified as the CEO of the combined Numericable-SFR, Denoyer said:  “The rumours you are referring to are probably true.”

Denoyer said a decision on SFR was “probably imminent” from the competition authority. He declined to comment on any commitments the pair had made to secure approval.

He said SFR was “an important player in the DSL market” and that the combined company would “play both at the high end and low end” whereas Numericable had targeted “only the higher end” of the broadband market.

Denoyer said that Orange was now focusing on its fibre product, delivering “sharper competition”. However, he said, this was a sign of growth in the fibre market that would ultimately benefit Numericable, and would play against companies that continued to focus on lower-end ADSL offerings, such as Bouygues Telecom.

Talking about the company’s results, Denoyer said that Numericable had shown “accelerating sales momentum” and “good operating leverage” with increased EBITDA for the quarter.

He said the operator’s multiplay customer base had grown strongly, and said Numericable had also been successful in capturing customers in the B2B sector.

Numericable posted revenue growth of 4% year-on-year. Analogue revenue streams decreased, but both digital and white-label revenues increased. CFO Thierry Lemaitre said that Numericable was on track to deliver 6.5 million high-speed broadband homes by the end of the year, and said that the company would keep to its previously stated investment limit.

He said that if the SFR deal is closed by the end of the year, as expected, Numericable’s current guidance would become obsolete.