Freenet AG no longer wants to sell mobile communications under the Mobilcom-Debitel brand. Corresponding plans will be presented to financial analysts on Friday. “Dual branding has always been a barrier to communication,” says presentation slides that were previously placed online. It was a compromise so as not to frighten existing customers. But now the future must belong to the unified brand “freenet”.
“Advertising a large umbrella brand is more efficient and effective,” the Freenet administration confirms. As of December 31, 2021, the value of the brand was still €293 million on the balance sheet. Of this amount, 49 million will be amortized over six quarters until the brand is redeemed in mid-2023. This affects the net result, but not the cash balance. In external communications, the brand will be abandoned already in July, with the support of advertiser Dieter Bohlen.
Last year 2021, Freenet AG slightly exceeded its forecast for a certain rate free cash flow and EBITDA (earnings before interest, taxes, depreciation and amortization). This out Freent slideshow as well as Thursday publish numbers Which, however, is still temporary. These numbers do not reveal a net loss. 80 percent of adjusted free cash flow is paid out as a dividend, which increases by about five percent.
Group sales in the fourth quarter of 2021 grew in the per thousand range to €675.5 million, and EBITDA increased by 11 percent to €107.4 million. At €61.5 million, free cash flow was three times higher than the previous year.
For the whole of 2021, Freenet AG reported revenue of €2.56 billion (-0.8%), EBITDA of €447 million (5%) and free cash flow of €234.4 million (-1.2%). If you deduct the contribution of the Swiss network operator Sunrise, whose shares Freenet has sold since 2020, free cash flow has grown by 16%.
Mobile communication is stable, the flow of subscriptions is increasing
The mobile sector accounts for the lion’s share of sales. Despite having nearly 7.2 million customers at the end of the year (about 100,000 more than at the end of 2020), sales fell slightly (-0.5% to €600 million in the fourth quarter, -1.5% to 2.27 billion in 2021). Meanwhile, EBITDA is booming (+19% to €92.5 million in the fourth quarter, +4% to €370 million in 2021).
The much smaller TV and media segment has two main pillars that are developing differently: while freenet TV is losing subscription customers (-105,000 subscriptions to 797,000 in 2021), Waipu.tv is recording a larger influx (+150,000 subscriptions to 723,000). In total, the annual turnover increased by a tenth to 285 million euros. According to the information, waipu.tv is now operating “absolutely above the break-even point”. For the current year, management expects stable, stable sales to a slight increase in EBITDA and a slight increase in free cash flow.
From Mobilcom to Freenet
The Mobilcom and Freenet brands belong to Mobilcom AG, founded in Schleswig in 1990 by Gerhard Schmid, and its subsidiary Freenet.de AG, an Internet service provider (ISP). After a sharp rise in competition to become a direct competitor to Deutsche Telekom, which was mainly due to Schmid’s marketing skills, a crash followed in 2002. Major shareholder and financier France Telecom wanted out after a German UMTS auction and pushed Mobilcom to the brink of collapse in 2002. Schmid was forced To vacate the seat of the Council.
Schmid’s successor, Thorsten Grenz, was able to integrate Mobilcom. He was succeeded by Eckhard Spohr, who previously headed ISP Freenet.de. After initial resistance, Spoerr merged the two parts in 2007.
The name Freenet AG was born. In 2009, Freenet acquired rival Debitel, which at that time was the third largest mobile operator in Germany with about 19 million customers. At the end of 2012, Freenet also bought Apple Gravis dealer. Since then, Gravis has also been selling mobile communications under the Mobilcom-Debitel brand.