freenet with record EBITDA and free cash flow for the 2024 financial year - Dividend proposal significantly higher than last year

freenet with record EBITDA and free cash flow for the 2024 financial year - Dividend proposal significantly higher than last year

• All financial key performance indicators (revenues, EBITDA, free cash flow) were within the guidance ranges raised by the Executive Board during the year.
• Revenues: Increase of 3.9 % to EUR 2,478 million (prior year: EUR 2,385 million) mainly due to the significant growth of waipu.tv subscribers (+571 thousand).
• EBITDA: Increase of 3.5 % to EUR 521.5 million (prior year: EUR 503.9 million), positively impacted by a one-off effect from the sale of IP addresses (EUR 18.4 million).
• Free cash flow: Increase of 5.7 % to EUR 292.3 million (prior year: EUR 276.6 million)
• Based on these figures, the Executive Board is proposing a record dividend of EUR 1.97 per share (prior year: EUR 1.77) and sees the potential for share buybacks of up to EUR 100 million.

 

Büdelsdorf, 4 March 2025 - freenet AG [ISIN DE000A0Z2ZZ5] today published its preliminary results for the 2024 financial year after close of trading (Xetra). All key figures refer exclusively to the continuing operations. The business activities of Gravis were completely discontinued at the end of June 2024. The results of Gravis are reported separately as discontinued operations (including restatement of the prior year's figures).

freenet Group: Adjusted EBITDA at prior year level reflects 2024 as `transition year´

The Executive Board's declared target of achieving significant customer growth in the 2024 financial year was met with success. In the IPTV business, waipu.tv gained well over half a million net new customers (+571 thousand). waipu.tv's position as the second-largest IPTV provider in Germany is unchallenged, with 1.94 million subscribers at the end of the year (prior year: 1.37 million). In the mobile segment, freenet has gained the most new postpaid customers in a single year since 2018 (+182 thousand net new subscribers). Overall, freenet clearly exceeded the 10 million mark with 10.149 million Mobile Communications and TV subscribers at the end of 2024 (end of previous year: 9.493 million). Building on this, revenues increased by 3.9 % to EUR 2,478 million (prior year: EUR 2,385 million).

Table1: Key figures freenet Group

Non-financial key figures		Unit		31.12.2024	31.12.2023		abs. Change	rel. Change
Subscribers1		million		10.149	9.493		0.657	6.9 %
Key financial figures		Unit		2024	2023   (restated)		abs.   Change	rel. Change
Revenues		EUR million		2,477.7	2,385.3		92.4	3.9 %
EBITDA		EUR million		521.5	503.9		17.6	3.5 %
Adj. EBITDA		EUR million		503.12	503.9		-0.7	-0.1 %
Free cash flow		EUR million		292.3	276.6		15.7	5.7 %

 

To achieve customer growth, the IPTV unit made additional temporary marketing investments of around EUR 20 million. Against this backdrop, an EBITDA range (EUR 495 million to EUR 515 million) was initially guided, with the midpoint just slightly higher than the prior year’s figure (EUR 503.9 million). The Executive Board has characterized 2024 as a "transition year" on the way to further significant growth by the end of 2028 (2028 Ambition). The expectation for EBITDA was raised during the year to between EUR 515 million and EUR 530 million due to a one-off effect from the sale of IP addresses totaling EUR 18.4 million. Including the one-off effect, EBITDA reached a record level of EUR 521.5 million, which corresponds to an increase of 3.5 % compared to the prior year. Adjusted for the one-off effect, EBITDA of EUR 503.1 million was on a par with the prior year (EUR 503.9 million), as expected. Free cash flow with EUR 292.3 million was in the centre of the guidance of EUR 285 million to EUR 300 million (previously: EUR 270 million to EUR 285 million), which was raised during the year, and 5.7 % above the prior year (EUR 276.6 million). Excluding the one-off effect, free cash flow reached the prior year's level as expected at EUR 273.9 million.

In view of the successful business performance, the Executive Board will propose an 11.3 % increase in the dividend to EUR 1.97 per share at the 2025 Annual General Meeting (prior year: EUR 1.77), of which EUR 0.12 is attributable to the aforementioned one-off effect. The Executive Board also sees the potential for a share buyback program in 2025 with a volume of up to EUR 100 million.

Mobile Communications segment: Increase in EBITDA by 1.7 % in the 2024 financial year

In the second half of 2024, the Mobile Communications segment recorded a substantial increase in postpaid customers (+157 thousand), driven by new launches and the restructuring of individual tariff portfolios. Overall, freenet - like the market - continued to benefit from the trend of customers moving from prepaid to postpaid contracts and the demand for independent advice. For the year as a whole, the guidance of moderate growth was met by reaching 7.600 million postpaid customers (prior yearend: 7.418 million).

Postpaid ARPU remained stable at EUR 17.9 compared to EUR 18.0 the prior year. Service revenues increased by 0.6 % to EUR 1,718 million (prior year: EUR 1,707 million) and continue to account for the majority of segment revenues. Total revenues in the Mobile Communications segment were EUR 2,057 million, thus showing the expected stable performance compared to the prior year (EUR 2,041 million).

EBITDA in the Mobile Communications segment increased moderately by 1.7 % to EUR 427.3 million (prior year: EUR 420.3 million), driven by a surge in gross profit due to the long-term contracts with mobile network operators (DTE, VOD, TefD) that were secured mid-year.

Table 2: Key figures Mobile Communications segment

Non-financial key figures		Unit		31.12.2024	31.12.2023		abs. Change	rel. Change
Mobile Communications subscribers		million		7.712	7.540		0.173	2.3 %
thereof Postpaid customers		million		7.600	7.418		0.182	2.5 %
thereof app-based tariffs3		million		0.112	0.121		-0.009	-7.4 %
Key financial figures		Unit		2024	2023    (restated)		abs.   Change	rel.   Change
Revenues		EUR million		2,057	2,041		16.5	0.8 %
thereof service revenues		EUR million		1,718	1,707		10.8	0.6 %
EBITDA		EUR million		427.3	420.3		7.0	1.7 %

 

TV / Media segment: Significant customer and revenues growth at waipu.tv

The increased investments to boost waipu.tv's brand awareness in order to utilise the customer potential from the abolition of the ancillary cost law ('Nebenkostenprivileg'), yielded the expected positive effect. In the TV and Media segment, there was a significant increase in TV subscribers to 2.437 million in the past financial year (year-end 2023: 1.953 million). waipu.tv grew by 571 thousand subscribers during this period (prior year: 399 thousand). The surge in waipu.tv subscribers, reaching 1.941 million (year-end 2023: 1.369 million), more than offset the anticipated decline in freenet TV subscribers, estimated at 87 thousand to 496 thousand (year-end 2023: 584 thousand). ARPU for both TV products remained stable compared to the previous year, despite intense competition on the German TV market.

Table 3: Key figures for the TV and Media segment

Non-financial key figures		Unit		31.12.2024	31.12.2023		abs. Change	rel. Change
TV subscribers		million		2.437	1.953		0.484	24.8 %
thereof waipu.tv subscribers		million		1.941	1.369		0.571	41.7 %
thereof freenet TV subscribers (RGU)		million		0.496	0.584		-0.087	-15.0 %
Key financial figures		Unit		2024	2023		abs. Change.	rel.  Change.
Revenues		EUR million		399.9	345.4		54.5	15.8 %
EBITDA		EUR million		102.9	110.2		-7.3	-6.6 %

 

Overall, the segment saw a significant year-on-year revenues increase by 15.8 % to EUR 399.9 million (prior year: EUR 345.4 million), primarily driven by the significant growth of waipu.tv.

In view of the increased investments in waipu.tv's brand awareness, segment EBITDA in the 2024 financial year was EUR 102.9 million, down 6.6 % from the prior year (EUR 110.2 million), as expected.

freenet Group: Guidance for the 2025 financial year

The Executive Board expects a noticeable increase in adjusted EBITDA (EBITDA excluding one-off effects) for the current financial year. The Executive Board is guiding adjusted EBITDA of between EUR 520 million and EUR 540 million. This guidance excludes the already known one-off effect of around EUR 14 million from the final tranche of the IP address sale. However, this one-off effect is included in the expected free cash flow of EUR 300 million to EUR 320 million in order to provide a complete picture for calculating the future dividend. The increase in adjusted EBITDA is mainly due to the expected business development of waipu.tv in the TV and Media segment (adj. EBITDA: EUR 115 million to EUR 135 million). Marketing investment activities at waipu.tv in 2025 will be below the level of the prior year, while the revenue-generating average number of subscribers at waipu.tv will continue to increase noticeably. Business development for the Mobile Communications segment is expected to remain unchanged compared to 2024 (adj. EBITDA: EUR 420 million to EUR 440 million).

freenet’s long-term financial ambition for the 2028 financial year presented in November 2024 remains unchanged. The Executive Board is confident that its adjusted EBITDA will exceed the 2023 financial year’s figure (EUR 504 million) by at least EUR 100 million by the end of 2028. Free cash flow is expected to increase to a minimum of EUR 330 million (2023 financial year: EUR 277 million). Adjusted EBITDA growth is expected to come primarily from the waipu.tv division.

Find further details on the guidance in the published presentation on the 2024 financial year.

Conference Call

The conference call on the preliminary results for the 2024 financial year will take place on Wednesday, 5 March 2025 at 10:00 a.m. (CET). All interested parties can follow the conference call via webcast (listen-only mode). A recording will be made available afterwards.

Further documents for publication

fn.de/downloadsir

fn.de/24fy

 

¹ Total of postpaid customers, freenet FUNK, freenet FLEX, waipu.tv subscribers and freenet TV subscribers (RGU)

² Adjusted for the one-off effect from the sale of IP addresses

³ freenet FUNK and freenet FLEX customers

 

Hint

In the interests of clear and transparent presentation, alternative performance measures (APMs) are used in the financial statements of freenet AG and in ad hoc disclosures in accordance with Art. 17 MAR in addition to the disclosures defined by the International Financial Reporting Standards (IFRS). The 2024 Annual report will provide information on the use, definition and calculation of APMs.

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