NOS SGPS (NOS) Q3 2024 earnings summary

Executive summary

• Strong business momentum and financial health supported by consistent strategic execution, market share gains in retail revenues, and robust performance across all business segments, especially in mobile, fixed, and convergent customer bases.

• Consolidated revenues grew 6.1% year-over-year to €432.7 million, driven by Telco and strong cinema/audiovisuals performance.

• EBITDA increased 6.3% to €213 million, with a margin of 49.2%, reflecting improved operating efficiency.

• Net income rose 14.6% year-over-year to €52.6 million, supported by operational gains and cost management.

• Achieved nationwide 5G coverage, becoming the first operator to cover all Portuguese municipalities.

Financial highlights

• Consolidated revenues up 6.1% year-over-year to €432.7M, led by Telco (+6.3% yoy) and Audiovisuals & Cinema (+1.7% yoy).

• EBITDA increased 6.3% yoy to €213.0M, with a 49.2% margin (+0.1pp yoy); EBITDA AL up 5.8% yoy to €181.6M.

• Net income rose to €52.6M, up €6.7M yoy, driven by operational performance and positive JV contributions.

• Free Cash Flow surged by €88.2M yoy to €117.4M, supported by operational momentum, lower CAPEX, and non-recurring tax impacts.

• CAPEX declined 4.9% yoy to €92.9M, reflecting structural reductions in Telco investments.

Outlook and guidance

• Stable and positive trends expected to continue into Q4, with the first nine months serving as a good proxy for year-on-year growth.

• Sustained free cash flow generation expected due to efficient cost control and declining investment needs.

• Ongoing cost efficiency initiatives, including AI-driven projects, expected to accelerate in 2025, supporting margin resilience amid anticipated pricing pressure.

• Continued investment in network quality and customer experience, with expansion of next-gen networks and a focus on technological innovation.

• Commitment to sustainability, with over 90% of financial debt linked to ESG KPIs.