Altice First-Quarter Earnings Stall as French Unit Strugglesby and
Adjusted Ebitda rose less than 1 percent to 1.62 billion euros
French division Numericable-SFR facing stiff competition
Altice NV, billionaire Patrick Drahi’s phone investment empire, reported stalling first-quarter earnings as sales at its French business declined amid competition from rivals including Iliad SA and Bouygues Telecom.
Shares of Altice dropped after the company reported that adjusted earnings before interest, taxes, depreciation and amortization rose less than 1 percent to 1.62 billion euros ($1.84 billion). Sales fell 2.7 percent to 4.26 billion euros, led by a 6.1 percent decline at the French arm, Numericable-SFR, whose shares also slumped.
Numericable-SFR is pushing into wireless media content such as sports and entertainment in a bid to get customers to spend more after years of price wars. Orange SA abandoned its attempt to buy the phone business of Bouygues SA, denying the French phone industry a much-sought consolidation that would have eased competition in one of Europe’s toughest markets.
“While France trends were tough, we expect improvement” this year, analysts at Goldman Sachs said in a note to clients. The performance of Suddenlink Communications, the U.S. cable company Altice acquired last year, was encouraging, the analysts said.
Adjusted Ebitda at Numericable-SFR was 851 million euros on sales of 2.57 billion euros. Analysts projected Ebitda of 878 million euros on sales of 2.59 billion euros, the average of three estimates compiled by Bloomberg.
Adjusted Ebitda at Suddenlink rose 21 percent to 242 million euros. Sales at the division increased 9 percent to 570 million euros as it gained customers.
Altice kept its forecasts for the current year. The company, which is expanding its business overseas, is buying U.S. pay-TV provider Cablevision Systems Corp. and last week received conditional green light from New York City for the $17.7 billion acquisition.