Investors believe in the new business plan Jazztel
| Date: March 3, 2010 | Source: AlertNet |
| Category: Business | |
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Loading ... Ambitious, but consistent when taking into account its recent trajectory. So experts see the new business plan Jazztel, which in three years wants to double its ADSL customer base and achieve a net profit of 50 million euros. Clear financial risk after debt restructuring, operational execution and aggressive competitors are the major risks of Jazztel.
"My impression is that the plan is very solid at the operating level, although the objectives of customer acquisition are above our expectations," said Antonio Fernandez, an analyst at Banco Sabadell. "If they maintain operational tempo in the fourth quarter of 2009, will achieve the objectives. The plan is consistent and the bag is excessive punishment. "
Jazztel yesterday presented its business plan until 2012. Broadly speaking, the operator Leopoldo Fernández Pujals presiding want to achieve a net profit of EUR 50 million at least for that year, four times the EBITDA to 145 million, doubling to 850 million revenue and increase market share from the 6 to 11% due to collection of 600,000 customers to reach 1.2 million.
"The plan is ambitious, aggressive, but have shown the market that are capable of doing so. In the past year have achieved the highest 30% of the market and to comply would have to continue that pace, "said Inigo Isard, an analyst at Link Securities. "Other old business plans were unrealistic, now the management is still very good. José Miguel García [chief executive] has responded. "
Jazztel has doubled its market share in the last two years by stealing customers from other companies. This high rate is 80% of total deposits, while the rest are new. According to sources, the stock of low amounts to two million customers, which together with the lower penetration of ADSL in Spain than in Europe provides growth potential operators.
The company, based in Alcobendas gets much of its customers the best prices, so a substantial improvement in the economy could embarrass the achievement of the strategic plan 2012, said Isard, Link. "The price sensitivity is lower when the recovery comes, Telefónica would invest in fiber and better connections, but the fact is that this recovery does not seem to be giving."
The operator ensures that the cost of fiber optics is affordable by households (there are fewer than 10,000 lines in Spain), and in return before the summer will offer a new 50 meg connection (VDSL2). Jazztel forecasts go through a wide bank penetration of 69% for 2012 compared to 60% today, so the number of ADSL lines will go up about 20% to 11.6 million.
One of the drawbacks that Sabadell analyst puts the operator's plan is the lowest EBITDA margin forecast. "Is everything a little bound, involves investments grow, decay and lower margin cash generation," says Fernandez. Jazztel plans to invest 210 million in three years. The EBITDA margin on sales in 2012 were placed in 18%, 25% below the average of its peers.
More details of the publication here .
