In Q4 the Netia Group recorded increase of revenue, improved EBITDA and even better operating performance in both its B2C and B2B segments. Over the whole year 2020, Netia managed to break the declining revenue trend while maintaining solid profitability.
The Netia Group’s Q4 revenue amounted to PLN 330 million (+5% quarter-on-quarter; +2% year-on-year) and for the full year 2020 it amounted to PLN 1.295 billion (comparable to 2019). The Netia Group’s B2B market revenue increased in Q4 to PLN 183 million (+5% QoQ, +4% YoY). On the other hand, the B2C market revenue reached PLN 139 million (+1% QoQ, -1% YoY). EBITDA in the last quarter of 2020 amounted to PLN 114 million (+1% QoQ and -1% YoY), while within the entire year it reached PLN 451 million (-1% YoY).
In the whole year 2020, the Netia Group allocated PLN 380 million for investments i.e. PLN 28 million more than in 2019. The increase in capital expenditures – primarily related to the construction of a modern Data Center in Jawczyce near Warsaw – caused the company to record negative operating free cash flow (OpFCF) of PLN - 25 million in the last quarter of 2020. In contrast, debt as of December 31, 2020 was 572 million, which constitutes a leverage of 1.27x EBITDA for 2019.
The difficult epidemic situation affected the process of access network modernization, however by the end of 2020 the Netia Group reached with its 1 Gb/s access offer as many as 1.73 million premises in total!
Effective B2B transformation
Sales of advanced ICT solutions from the NetiaNext line, which are the basis for the B2B segment transformation, increased by 55% in 2020. Since the launch of the NetiaNext initiative three years ago, the number of customers of this type of Netia services has almost tripled and now exceeds 1,200. At the same time, typical telecommunications services, i.e. data transmission and voice services, were highly stable, resistant to competitive pressure and they were not affected by the epidemic. At the end of 2020, the company again recorded the increase of revenue with regard to wholesale voice termination.
Since November 2020, Netia has been successfully commercializing its modern Data Centre facility in Jawczyce near Warsaw. At the end of 2020, there were more than 250 projects in the sales funnel and the number grew rapidly in the following weeks of the new year.
B2C with a (not only) Internet record
The growing range and coverage of the modernized network and the attractive bundled offer (in particular the Internet + new TV offer), contributed to the record growth (achieved organically) in the number of services provided within own networks (+21 thousand services). As a result, at the end of 2020 Netia’s B2C segment provided 1.388 million services (+1% QoQ , +2% YoY). As much as 61% (+4 pps QoQ) constitutes services provided within own networks (for broadband services this ratio is 71%).
The number of Internet access services reached 572 thousand (+8 thousand QoQ) at the end of December 2020, while the number of TV services amounted to 279 thousand (increase by 12 thousand). During 2020, the number of TV services provided by Netia increased by 18%. Robust growth was also recorded in mobile services – 164 thousand subscribers of Netia Mobile at the end of 2020 (+4 thousand QoQ, increase by 12% YoY). On the other hand, the number of telephone services, as always, decreased to 372 thousand (-15 thousand QoQ).
Netia’s strong position as a provider of super-fast broadband Internet access via fibre optic technologies is also confirmed by the results of the 2020 ranking of fibre optics website “speedtest.pl” in which Netia is the top-ranked nationwide operator.