Intred (ITD) H1 2024 earnings summary

Executive summary

• The 2024–2027 Strategic Plan targets double-digit EBITDA growth and a 50% margin by 2027, with €80M+ in investments focused on FTTH, data centers, and M&A, leveraging a strong Lombardy presence.

• 1H2024 revenues rose 5.6% year-over-year to €25.9M–€26.3M, mainly from fiber connections and network expansion; including Connecting Italia, cumulative revenue was €27.5M, up 12.1%.

• EBITDA for 1H2024 was €11.5M (43.6% margin), up 6.7% year-over-year; net profit was €3.5M, down 9.2% due to higher depreciation and financial expenses.

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

• Completed and integrated acquisitions of Qcom and Connecting Italia to strengthen Lombardy presence.

Financial highlights

• 1H2024 value of production was €26.3M, up 6.4% year-over-year; revenue from sales and services reached €25.9M, up 5.6%.

• EBITDA: €11.5M (43.6% margin), EBIT: €5.8M (22.2% margin), net profit: €3.5M (13.5% margin), all reflecting stable or slightly declining margins.

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

• Cash flow from operating activities in 1H2024 was €17.5M–€18.2M, with significant outflows for investing activities.

• Total assets reached €151.3M as of 30 June 2024; shareholders’ equity increased to €57.0M.

Outlook and guidance

• 2027 targets: value of production €67–73M, EBITDA €34–36M, EBITDA margin 50%.

• 2024 value of production expected at €56–58M, with EBITDA margin of 42–44%.

• Capex to remain high through 2025, mainly for data centers; net debt to peak in 2025 and decrease sharply from 2026, with strong cash generation expected.

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

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