Tele Columbus, Germany’s third largest cable operator, suffered from an increased churn rate in Q1 2018, leading to a partial revision of the management’s full-year targets.
In light of the ongoing integration efforts, which negatively affected customer service, the company decided to delay the ramp-up of marketing activities. This, combined with an integration related churn peak resulted in a flat development of internet RGUs, Tele Columbus reports in its Q1 2018 statement.
The CATV RGU development is down quarter on quarter as contracts are typically cancelled effective December 31, according to the company. These losses are planned to be partially compensated over the course of the year.
While the ongoing Pepcom customer migration is on track and scheduled to be finalised by the end of Q2 2018, the project revealed the necessity for additional fine tuning and follow-up tasks in the second half of 2018. These relate, amongst others, to Pepcom’s complex product and technology portfolio, according to Tele Columbus.
Hence, based on the final figures for Q1 2018, better visibility of business trends, temporary higher costs driven by investments in the delivery capabilities of the company and the expectation that in the short term these effects cannot be offset by stronger growth, the management board reviewed its forecast and decided to partially revise its full year targets for 2018.
The management board expects for 2018 a stable number of connected homes of around 3.6 million, low to mid-single digit percentage revenue growth year on year, normalised EBITDA of €265 to €280 million and between 27% and 30% capex over revenues. The board confirms its mid-term outlook and guides on capex peaking in 2019.
