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Domestic revenues were up by 4.3% yoy in Q3 exactly like in H1: a good number as the H2 was supposed to be less strong. Domestic EBITDA, which was down by only 0.7% yoy, was also better than expected. The group raised its guidance for 2023: revenue should grow by 3.5/4% (vs 2/3% previously) while the EBITDA decline should be limited to 2% (vs -3% previously). We maintain our opinion at Buy.
Companies: Proximus (PROX:EBR)Proximus SA (PROX:BRU)
AlphaValue
An H1 in line with the 2023 guidance given in January. The dividend which was rebased to €0.60 for 2024-25 was something of a disaster for the stock that will be stuck at the current level for quite a while as its EBITDA-capex is unlikely to increase any time soon. The important long-term potential of the recent acquisition of Route Mobile is not valued by the market. In five years the stock will be worth much more than today.
The stock was down by 2.5% this morning with the release of Proximus’ new 3 year strategic plan. EBITDA is expected to return to growth as of 2024, following a temporary decline of around 3% in 2023 when the inflation impact is expected to peak. By 2025, EBITDA is expected to return to the 2022-level. As a result, while in 2023 the dividend will be stable at €1.20, it will however be rebased to €0.6 over 2024-25.
The Q2 was slightly better than expected. We expect Proximus to see modest sales and Ebitda growth in the coming years. However Proximus has been lagging behind its peers on fibre deployment and needs to invest. The group is not yet out of the woods in terms of its EBITDA less capex and is unlikely to increase its dividends any time soon. The group is trading at a significant discount and we maintain our Buy opinion despite seeing no catalyst in the short term.
Companies: Proximus SA (PROX:BRU)Proximus SA (0DPU:LON)
Like in the previous quarter, the Q4 EBITDA was disappointing, down by 4.7% yoy and lfl. The good point is, however, that Proximus expects its Domestic revenue and EBITDA to grow up to 1% yoy in 2022. In line with its accelerated fibre deployment, Proximus’ capex should grow by 8% in 2022 to exceed 20% of its sales. Well, the group has not yet left the inn and is unlikely to increase its dividends any time soon. We remain, however, at Buy.
Domestic revenue was slightly disappointing, down by 2.1% yoy and lfl. Consumer revenue was indeed down by 1.6% due to the ongoing trend of Consumers opting increasingly for a product combination excluding a Fixed Voice line. We remain at Buy on the stock which remains heavily discounted vs its peers but Proximus is lagging behind in the deployment of fibre compared to its peers and has to invest. So no catalyst in the short term.
Proximus’ Q1 was globally in line with expectations. The key point is that Proximus has been lagging behind in the deployment of fibre compared to its peers and has to invest. So the group has not yet left the inn and should not immediately increase its dividends. In our view, even if there is quite a solid upside in the long term for the stock there are few catalysts in the short term for the price to take off.
The stock was down by 10% last Friday (26 February) after the release of a disappointing Q4 but, above all, a poor outlook for 2021. Management expects indeed only flat revenues and an EBITDA down by 3-4% yoy, while capex should up by 20%. However, we still believe that, given the investments made, Proximus deserves a degree of reappraisal as its yield remains safe and the dividend may ultimately grow with the pay-back on its speedier and augmented capex.
A good Q3 with a resilient and better-than-expected EBITDA. As a result Proximus has revised its 2020 guidance upwards with EBITDA-CAPEX at €830m vs €780m-800m previously. Over 2020-22 the group is supposed to return a dividend of €1.2 (-20% compared to 2019 to invest more than ever in fibre and 5G). This level should, however, be considered as a floor and we believe the dividend could be raised earlier than currently expected.
Companies: Proximus SA
A correct Q2 with in particular a very good resilience in the EBITDA, which was down by only 1.5% yoy despite a logical 5.9% decline in revenues due to the COVID-19 pandemic. Proximus reiterates once again its 2020 full-year guidance of EBITDA minus capex of €780-800m. Therefore the new dividend of €1.20 over 2020-22 proposed in early 2020 has to be considered as… a floor perfectly sustainable over the period. We maintain our Buy opinion on the stock.
Proximus is a no-growth story for 2019… but is securing quarter after quarter its solid position on the Belgian TV side thanks to the deployment of its fibre network. The stock has recovered 35% since July 2018. It is no longer very far off our target price which has not changed much in a year. We maintain our opinion at Add on the stock.
Proximus is a no-growth story for 2019. The stock had recovered with a 20% increase during Q4. The stock is down by 6% this morning, investors preferring to move towards growth stocks while shedding no growth yield values. We believe however this is still an opportunity to buy the stock given the secure yield and the fact that the group is currently winning, slowly but surely, market share on the TV side.
The key point to highlight is that Proximus is currently winning market share (likely 34.5% at end 2018 vs 32% at end 2016) on the TV side vs Telenet. Even if Proximus does not offer genuine growth prospects and will have to face Telenet’s offensive in the quadruple play, its restructuring enables it to be more competitive and well positioned to maintain its leadership in 4G and to win market shares on TV… and also to offer a strong dividend.
Q1 revenues were flat yoy. And that is indeed slightly better than in the previous quarter (-0.9% in Q4). Domestic revenues were up by 0.9% yoy thanks to the Fixed data and TV services and despite the impact of the “Roam like at home” regulation, while revenue from BICS (the International Carrier division combined with that of the African telco MTN) were down by 3.9% yoy (it had decreased by 6.6% in Q4), but they included the consolidation of TeleSign for one month more. As in previous quarter
The group released last Friday (2 March) its Q4 results. Q4 revenues were down by 0.9% yoy, a slighter less decline compared to the -3.2% yoy recorded in both Q3 and Q2. Domestic revenues were indeed up by 0.9% despite the impact of the “Roam like at home” regulation, while revenue from BICS (the International Carrier division combined with that of the African telco MTN) were down by 6.6% (vs -12% in Q3 and Q2), but they included two months’ consolidation of TeleSign (the organic decline was in
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CyanConnode exceeded FY24 revenue expectations and has high visibility into FY25, supported by strong deliveries and a growing backlog respectively.
Companies: CyanConnode Holdings plc
Zeus Capital
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Shore Capital
Artificial intelligence (AI) is a double-edged sword in cybersecurity. Whilst new AI models, architectures, and innovations are emerging to protect the security posture of organisations, attackers are also benefiting from deepfakes, sophisticated phishing, and automation of malicious codes. To ensure the impact of AI on cybersecurity to be a net-positive, we need to pit good AI against bad AI. Point solutions enhanced with machine learning: Global cybersecurity has been built with point soluti
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Hybridan
CyanConnode provides end-to-end communications platforms that connect Internet of Things (IoT) devices such as smart meters to a utility's billing system. The company is a global player and a market leader in India, where a new government scheme, as set out below, has mandated the procurement of 250m meters by March 2025, a significant market opportunity for CyanConnode.
Gamma’s results for the year ended 31 December are in line with the expectations confirmed in the January trading update. Revenue of £521.7m is 8% ahead of FY22, with gross profit at £267.2m showing the same progress. Adjusted EBITDA grew by 9% and PBT by 10%, although the impact of higher tax rates was seen in the 5% increase in adjusted EPS. Cash generation was strong once again, with 108% adjusted cash conversion. Year-end cash of £134.8m is £42.3m above the year before, even after the £30.5m
Companies: Gamma Communications PLC
Progressive Equity Research
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Cavendish
CyanConnode has steadily been making progress in India, where the national smart meter programme has been gathering pace. In July 2022, the company crossed the one million mark for meters connected to its RF network across nine Indian states. This is the aggregate RF device number in India connected since 2014 and represents market share of 22%. The latest update from the company states an order book of 2.6m RF nodes for India. Performance of smart meters is a critical aspect of the Indian progr
Hardman & Co
CyanConnode has received a large Letter of Award (LOA) for Omnimesh Cellular Modules (CNICs) from a Thai customer.
Companies: SWG DUKE LORD CLX
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CyanConnode’s H1 results position the company to meet our full year forecasts. The company does not need to grow revenue yoy in H2 in order to meet full year estimates. The Indian smart metering programme appears on track, with 98m smart meters already awarded to prime bidders and these orders should soon filter down to competitively well positioned subcontractors such as CyanConnode. These market drivers position the company well to grow revenue 39% in FY24 and 111% in FY25 and for a £1.9m of o
Filtronic has reported results in-line with management expectations for H1/24, and now expects to perform ahead of our forecasts for FY24E and FY25E in terms of revenue and profit. We are raising our revenue forecasts for FY24E and FY25E by 14.6% and 6.2% respectively, and our EBITDA forecasts by 85.2% and 28.0% respectively. The increase in expectation is driven by a strong recent acceleration in order flow, including a £7.8m order announced today. In this report we present a detailed review of
Companies: Filtronic plc
Revenue grew 23% in FY23 with limited contribution from Indian RDSS contracts
As revealed in last week’s interim update, strong demand continued through 1H23 and into 2H23, fuelled by demand for backhaul modules in the ongoing 5G rollout, newly won defence contracts and a post-COVID recovery in critical coms. This led to solid +5% yoy growth in 1H revenue and a current record order book of £17m – a full year’s worth of business for the group. The update also revealed that shortages and the resulting price hikes on specific components led to FTC delaying some 2H23 producti
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