Intred (ITD) H1 2024 earnings summary

Executive summary

• Strategic plan for 2024-27 targets growth via FTTH, data centers, and M&A, focusing on Lombardy and leveraging a strong regional presence.

• Over €140M invested since 2016, expanding a proprietary network to 13,000km and serving 51,000 users.

• Compound yearly rate of return since listing is +25%, with a proven track record in shareholder returns and integration of acquisitions.

• Sales rose 5.6% year-over-year to €25.9M, driven by fibre connections and the acquisition of Connecting Italia S.r.l.

• Over 3,900 schools activated under School Tenders, contributing €4.4M turnover in H1 2024.

Financial highlights

• 1H2024 revenues rose 5.6% year-over-year to €26.3M; EBITDA up 6.7% to €11.5M, with a margin of 43.6%.

• Net profit for 1H2024 was €3.5M, down 9.2% year-over-year; EBIT margin at 22.2%.

• Net financial position worsened to -€27.4M at 1H2024, reflecting ongoing investments.

• Cash flow from operating activities in 1H2024 was €18.2M; capex reached €18.7M, mainly for FTTH expansion.

• Cash funds increased to €8.7M at period end.

Outlook and guidance

• 2027 value of production targeted at €67-73M, with EBITDA of €34-36M and a 50% margin.

• Capex to remain high through 2025, mainly for data centers, with net debt peaking in 2025 and expected to decrease sharply from 2026.

• Data center business expected to contribute positive EBITDA from 2027, with IRR >20%.

• Management expects strong revenue growth in H2 2024, led by ultra-broadband services and continued network investment.

• Dividend policy to continue, with potential for increased distributions as net debt declines.