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Research Tree provides access to ongoing research coverage, media content and regulatory news on TELE2 AB-B SHS. We currently have 5 research reports from 1 professional analysts.
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TELE2 AB-B SHS
TELE2 AB-B SHS
A solid Q4 but the stock is now at its price
26 Jan 17
Quite a good Q4 release for Tele2 Q4 revenues have grown by 18% yoy but it includes for the first time the acquisition of the B2B service provider TDC Sweden. Adjusted for this acquisition and also from FX, revenue growth was indeed 6.5% yoy: a number clearly better than the 3% recorded in the previous quarter, even if it also includes, like in Q3, the business joint-venture in Kazakhstan with Kazakhstan Telecom (which has an impact of c.4.5% on global growth). EBITDA has grown in reported terms by 9%, and by 1% yoy excluding the consolidation of TDC. It is also better than the 2% decline recorded in Q3. And note also that, adjusted for the joint-venture in Kazakhstan, EBITDA growth was indeed 4% in Q4! For 2016, the board has decided to recommend an ordinary dividend of SEK5.23 but Tele2 expects to propose a dividend of SEK4 for 2017. By financial year 2019, Tele2 expects the dividend to be fully covered by equity free cash flow generation.
Becoming more Swedish over time
21 Jul 16
The Q2 release has confirmed the weak guidance given by the group at the begining of the year (while revenues should grow slightly by 2%, EBITDA should be between SEK4.6bn and SEK5bn vs SEK5.75bn in 2015 due to the roll-out and commercialisation of Tele2’s 4G network in the Netherlands). Q2 revenues, as expected, have grown by 1% yoy while EBITDA was down by 21%, primarily impacted by costs associated with the commercial push in the Netherlands following the 4G LTE network launch, but also by Sweden’s non-recurring items as well as declines in the fixed operations. The most important news in the quarter was indeed the announcement of the acquisition of TDC, one of the strongest B2B service providers in Sweden. On 21 June, Tele2 announced that it had signed a contract to acquire 100% of TDC Sweden for SEK2.9bn on a debt free basis. The transaction is subject to approval by the regulatory authorities, which is expected in Q4. TDC Sweden is a provider of B2B services in Sweden, serving both the public sector and many Swedish blue-chip customers with their entire end-to-end connectivity and communication needs. TDC Sweden has a strong position in attractive product segments, and a solid track record of profitable growth, delivering net sales in 2015 of SEK3.4bn and an EBITDA of SEK0.4bn. The operations had 809 full-time employees at the end of 2015. Tele2 estimates the annualised run rate for opex and capex synergies should amount to c.SEK300m, with additional one-off capex synergies estimated at SEK200m. Positive effects of cross-selling are also expected. Preliminary estimates for the integration costs and other one-off costs required to achieve synergies amount to c.SEK750m.
The growth engines are stalling
28 Jan 16
Exactly like in the previous quarters, Q4 sales increased by 2% yoy at constant currency while the EBITDA declined by 5% yoy despite a good performance in Sweden (+8% yoy). The reason for this expected weak performance was the Netherlands where increasing data traffic and costs associated with the MVNO agreement as well as an acceleration in the mobile rollout resulted in a decline in the Dutch EBITDA which amounted to SEK35m in Q4 vs SEK172m a year ago (and SEK275m two years ago). The headline news from this release is, however, the weak guidance for FY2016: while revenues should grow slightly (by 2% in our model) the EBITDA should be between SEK4.6 and 5bn vs SEK5.75bn in 2015 due to the roll out and commercialization of Tele2’s 4G network in the Netherlands.
How much is Tele2 worth?
26 Oct 15
Exactly like in Q2, Q3 sales increased by 3% yoy at constant currency while the EBITDA declined by 5% yoy despite a doubling of the EBITDA in Kazakhstan and stability in Sweden. The reason for this expected weak performance is The Netherlands where increasing data traffic and costs associated with the MVNO agreement as well as an acceleration in the mobile rollout resulted in a decline in EBITDA which amounted to SEK –83m.
Obsolete German and Austrian assets weigh on the overall Q2 EBITDA
21 Jul 15
Q2 sales increased by 4% yoy at constant change and are slightly better than what we were expecting. Note that although the solid growth registered in Sweden in Q1 (+4%) stopped due to a lower mobile customer stock, Kazakhstan confirmed logically its role as an engine of growth with a 23% increase in its sales yoy (corresponding now to 7.5% of Tele2's global sales). But the Q2 EBITDA was below our estimates (even if it is not a real surprise as we believe that the German and Austrian assets are obsolete) with a decline of 5% yoy despite a positive EBITDA in Kazakhstan and quite a good 3% growth in… Sweden. The German and Austrian EBITDAs were indeed down by 25% yoy and we don’t believe they are about to go up at any time soon. Note the group is maintaining its 2015 financial guidance of revenues at around SEK26-27bn with an EBITDA between SEK5.8bn and SEK6bn.
Making Mobiles Better
17 Jan 17
Mobile phones are increasingly the key connection for the modern world. This means that the performance of mobile phones, and their networks, is going to become more critical for all the apps and businesses that rely on them. New technologies such as VR, AR, and AV will need better, more reliable connections to really move into the mainstream. In this thematic piece we attempt to identify some of the most important issues facing mobile phone networks and their users, and start to identify solutions and enablers that will solve these problems and create value by doing so.
FY 2016 results confirm further strong delivery
21 Mar 17
Gamma’s FY 2016 revenues, Adjusted EBITDA and Adjusted EPS numbers were a touch ahead of our estimates. We make small upward adjustments to forecasts for all three years of our forecast horizon reflecting that performance. Gamma is capitalising on its position as a nimble player in an attractive marketplace. It made strong progress in 2016 as Voice over IP technology drove uptake of SIP Trunking and Hosted PBX services - both areas where Gamma has strong platforms. In addition, data services reflected Gamma’s investment in its network, channel partner numbers increased again and the indirect business accordingly showed strong revenue growth. The Direct Business also produced good growth and won some significant new contracts. The outlook statement is ’enthusiastic’ about the current year and comments that the Board ‘remains open to suitable M&A opportunities and areas for strategic capital investment’. Overall, an optimistic picture, in our view.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Panmure Morning Note 18-07-2016
18 Jul 16
We look for an in-line set of H1s from Spirent; this follows the Q1 beat. Look for good cash generation, good performance in the Networks division, ‘spotty’ at Wireless division, regionally growth in APAC offset by North America and EMEA customers who are “slow to release budgets”. Spirent should reaffirm the FY outlook – but will flag currency. Whilst the macro backdrop remains fragile, in truth Spirent is a story of getting its house in order and achieving better sales execution. We reiterate that our general investment view (Buy when others are frightened) has captured the zeitgeist and shares have performed well this year. That said there are some neat big picture drivers; 5G remains a prize being dangled as are the opportunities in IoT, high-speed data centre and driverless cars – indeed these should ensure that the shares pick up some Arm-related enthusiasm. Spirent enjoys an attractive valuation (2016E EV/Sales 1.1x, 7.0x EV/EBITDA) relative to sector peers (see table) despite sporting similar operating KPIs (see table). Our target price is 120p. Buy
Panmure Morning Note 13-06-2016
13 Jun 16
More news on 5G means a favourable read-across for the key 5G ‘name’ – Spirent. Today the Dutch Ministry of Economic Affairs has gathered 10 partner organisations together to run a 5G test in North Groningen – tests to be carried out at the end of the year. This is favourable for Spirent as it illustrates that 5G is getting closer and with it raises the possibilities of earlier revenue opportunities for Spirent. Short term is good for share sentiment. We retain our Buy.
Signs of recovery after a difficult 2016
08 Mar 17
As flagged by the recent trading update, group FY 2016 revenue slipped 7% YoY to $90.4m; 43% ($38.5m) of this came from Telecoms, which saw the majority of the decline in revenue as the legacy copper-based equipment sales continue to be wound down. The Bio-Medical division sales slipped just 2% YoY to $51.6m; a poor year from sterilization being compensated for by growth in diagnostics. While gross margins remained firm in both divisions (40% and 25% respectively), both slipped into operating loss; a hefty $2.2m from Telecoms (due to the loss of revenue from contracts) and $0.3m from Bio-Medical; however, the $2.5m operating loss was covered by an exceptional $3m profit on sale of a property. That sale helped cash; $1m received from operations was offset by $6m capex but cash from the sale of assets lifted BATM’s net cash from $21m to a welcome $23m at the year end.