SFR Altice France - comment

The Company released their Q4 numbers but given the refinancing/Term Loan extension in January, significant portion of the information had already been released. First Quarter financials are also in line with the guidance issued in January. As outlined previously, there is one last 5G payment in Q4 2023, and subsequently there is a step down in related Capex. XpFibre, which is not consolidated yet, is likely to be 3.5x leveraged during FY23, and therefore will be marginally deleveraging when Altice exercise their call option to increase their stake.

SFR reiterated their guidance of 4.5x net debt to EBITDA, which will be driven by lower CAPEX post FY23, some operational efficiency and the phasing out of non-recurring cash outs namely Altice TV funding and restructuring costs. SFR Altice France may come to the market in H2 23 if favourable conditions, but more likely in H124, with upcoming maturities of over €1bn of bonds and €500m of Term Loans due in Q1 2025. FY23 is likely to be a year of operational focus.