(Finance) – The Board of Directors of TIM has approved unanimously the Industrial Plan 2024-2026 “Free to Run”with the sale of the fixed network (NetCo) which will allow TIM to move on the market with fewer financial and regulatory constraints and with a greater focus on industrial components.
THE financial targets on the base of new perimeter (organic data, including Sparkle) predict revenues Group growth of an average of 3% per year over the plan period (CAGR 2023-2026) from 14.4 billion euros pro-forma in 2023; for TIM Domestic, revenues will grow by an average of 2% per year in the three-year period from 10 billion euros pro-forma in 20233. For 2024, Group revenues are expected to grow by 3-4% and by 2-3% for TIM Domestic.
L’Organic EBITDA After Lease of the Group is expected to grow by an average of 8% per year over the plan period (CAGR 2023-2026) from 3.5 billion euros pro-forma in 2023; for TIM Domestic organic EBITDA After Lease growing by 9-10% on average per year in the three-year period from 1.9 billion euros pro-forma in 20233. For 2024 organic EBITDA After Lease of the Group growing by 8-9% and 9-10% for TIM Domestic
L’Organic EBITDA After Lease-Capex of the Group is expected to increase from 1.3 billion euros pro-forma in 2023 to approximately 2.2 billion euros in 2026; for TIM Domestic organic EBITDA After Lease – Capex growing to approximately 1.1 billion euros from 0.6 billion euros pro-forma in 20233. For 2024 growth of 15-17% is expected at Group and national level 11-12% for TIM Domestic.
The Board of Directors expects a reduction inindebtedness of the Group, with a Debt/EBITDA After Lease ratio decreasing to 1.6-1.74 times compared to 3.85 times pro-forma in 2023. The Group estimates a Equity Free Cash Flow After Lease positive in both Italy and Brazil over the plan horizon.
As regards the individual entities that make up the Group TIM’s industrial plan includes the following strategic lines: for TIM Consumer the stabilization of the core business will continue, with a progressive increase in fixed and mobile Arpu, while improving customer convergence between the two sectors, and in parallel the Customer Platform model will be developed, with a focus on revenue growth beyond connectivity through new partnerships and opportunities in the household and small and medium-sized business sectors; TIM Enterprise, leveraging its positioning and unique competitive advantages, the acceleration of revenues from services will continue driven by further expansion in the ICT market, amplified by a positioning in key growth sectors (Cloud, IoT, Cybersecurity), and in particular focus will be dedicated to the Cloud sector thanks to partnerships with the main global operators and the full operational launch of the National Strategic Hub (of which TIM is the main partner and technological enabler); For TIM Brazil Further growth in revenues and EBITDA is expected, with cash generation growing in double digits over the plan horizon.
At the level Domesticwe read in a note, the plan also provides for a second phase of the cost transformation project, with incremental targets of 400 million euros by 2026 linked to simplification and downsizing of cost structures. Particular attention will be paid to efficiency in the Consumer sector and the internalization of resources and skills in the Enterprise area.