In the first nine months of 2023, DIGI recorded an increase in revenue of 13.2% YoY, an increase in EBITDA of 15.9%, and a decrease in total net profit of 25.9%, amounting to EUR 39.8m.
In the Romanian market, the company observed an increase in revenue of 4.8% YoY, amounting to EUR 754.2m. Revenue growth in Romania in Q3 was mainly the result of the increase of mobile telecommunication services, fixed internet and data, and pay-TV RGUs in the period, due to organic growth.
In the Spain market, DIGI recorded revenues of EUR 466m, noting an increase of 30.5%. The increase in Spain’s revenue in Q3 was due to the increase in mobile telecommunication services and fixed internet and data RGUs in the period, mainly driven by DIGI’s attractive offerings. In the Other market, Digi witnessed a slight increase in revenues of EUR 1.1m, amounting to EUR 21.7m. A slight increase was driven by operations in Italy and Portugal.
Turning our attention to the operating expenses, in 9M 2023, OPEX amounted to EUR 1.13bn (+13.3% YoY). The highest increase in operating expenses could be observed in Spain, where OPEX amounted to EUR 372m (EUR 67.6m YoY increase). This growth follows the evolution of business developments in mobile telephony services. In Romania, OPEX increased in line with revenue growth, increasing by EUR 6.9m to EUR 423.8m.
As a result of all of the above-mentioned, DIGI reported an EBITDA of EUR 429.8m, which represents an increase of 15.9%. As a result of sales increasing faster than the EBITDA, the EBITDA margin observed a slight decrease of 0.8 p.p. and currently stands at 34.7%. Meanwhile, operating profit amounted to EUR 119.4m, representing an increase of 1.8%.
Going further down the P&L, the company recorded a slightly worse net financial loss of EUR 5.9m and currently stands at EUR 63.5m. As a result of the above-stated, the company’s net profit from operations decreased from EUR 53.7m to EUR 39.8m, a decrease of 25.9%. Finally, we emphasize the YoY changes excluded Net profit from the period (discontinued) to make a comparison with the same denominator. The discontinued operations in Digi’s financial statements highlight the sale of Hungarian operations during the comparable period in 2022.
Digi key financials 9M 2023 [EUR m]
Source: BVB, InterCapital Research