REG - Zegona Comms. - Zegona Holdco Limited debt reporting as at 30/9/24
20/12/2024 07:00
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RNS Number : 8318Q Zegona Communications PLC 20 December 2024
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN
OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER
JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION IS UNLAWFUL.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
FOR IMMEDIATE RELEASE.
LEI: 213800ASI1VZL2ED4S65
20 December 2024
Zegona Communications Plc. ("Zegona")
Publication of Zegona Holdco Limited's debt reporting as at 30 September 2024
· Zegona has today published unaudited condensed consolidated financial
information in relation to Zegona Holdco Limited and its subsidiaries ("Zegona
Holdco Group"), for the sole purpose of satisfying the Zegona Holdco Group's
external debt reporting obligations as required pursuant to the Senior
Facilities Agreement dated 15 July 2024. This includes the consolidated income
statement of the Zegona Holdco Group for the six months ended 30 September
2024, together with the consolidated statement of financial position as at 30
September 2024. In addition, certain key performance indicators (KPIs) of
Vodafone Spain for the three months ended 30 September 2024 are included.
· The financial information is set out in the appendix to this announcement.
· The unaudited condensed consolidated financial information can be found on
Zegona's website at
https://www.zegona.com/investor-relations/debt-investors.aspx
(https://www.zegona.com/investor-relations/debt-investors.aspx)
· Following an internal reorganisation at Zegona's corporate company secretary,
Gen II Services (UK) Limited has been appointed as Zegona's Company Secretary
with immediate effect, replacing Gen II (Jersey) Limited.
Enquiries
Tavistock (Public Relations advisor - UK)
Lulu Bridges / Katie Hopkins / Ruairi Millar
Zegona@tavistock.co.uk (mailto:Zegona@tavistock.co.uk)
Tel: +44 (0)20 7920 3150
About Zegona
Zegona was established in 2015 with the objective of investing in businesses
in the European Telecommunications, Media and Technology sector and improving
their performance to deliver attractive shareholder returns.
On 31 May 2024, Zegona completed the 100% acquisition of Vodafone Spain
for €5.0 billion.
Neither the content of Zegona's website nor any website accessible by
hyperlinks on Zegona's website is incorporated in, or forms part of, this
announcement.
Zegona Holdco Limited ("the Company")
A company incorporated in England and Wales, company number 10159604 with
registered office address of 8 Sackville Street, London, England, W1S 3DG
Condensed Consolidated Financial Information
Unaudited
30 Sep 24
Zegona HoldCo Limited and its subsidiaries ("the Zegona HoldCo Group" or "the
Group") presents the Group's unaudited consolidated statement of financial
position and its consolidated statement of financial position for the periods
noted in the following pages.
Purpose of this information
This information is provided for the sole purpose of satisfying the Company's
external debt reporting obligations as required pursuant to the Senior
Facilities Agreement dated 15 July 2024.
1. Operational Commentary
Zegona Holdco Limited and its subsidiaries (the 'Group'), as part of the wider
Zegona Communications Plc. group, completed its acquisition of Vodafone
Holdings Europe S.L.U. and the trading entities Vodafone España S.A.U.,
Vodafone ONO S.A.U. Vodafone Servicios S.L.U. and Vodafone Energía S.L.U.
(together "Vodafone Spain") on 31 May 2024 (the 'Date of Acquisition').
In accordance with our external debt reporting obligations as noted above, we
present the consolidated income statement of the Group for the six months
ended 30 September 2024, together with the Group's consolidated statement of
financial position as at 30 September 2024. Due to the acquisition occurring
on 31 May 2024, the consolidated income statement includes only four months of
the operations of Vodafone Spain. We also present certain key performance
indicators (KPIs) of Vodafone Spain for the three months ended 30 September
2024. In addition, we provide comparative KPIs being the three months ended 30
June 2024.
Since the date of acquisition, management have initiated a number of key
actions as part of the transformation of Vodafone Spain. Management have
achieved savings in all cash cost categories which has created the ability to
reinvest in the customer base. Although very early days, this customer
investment is starting to deliver improvements in the company's overall
attractiveness and competitiveness in the market place. The financial impact
of actions taken to date has also been positive with improvements in EBITDAaL
and cash flow.
Key milestone events:
On 17 July, Zegona successfully refinanced the acquisition financing with
long-term financing placed with Spanish and international institutional
investors.
On 24 July, Zegona announced that Vodafone ONO, S.A.U. and MasOrange signed a
confidential non-binding term sheet setting out the proposed key terms for a
national network sharing agreement. The transaction will involve Vodafone
Spain and MasOrange creating a joint fibre network company covering
approximately 11.5 million premises across Spain and will provide fibre access
services to both companies within this footprint.
On 7 November, Zegona announced Vodafone ONO S.A.U., Telefónica de España
and Bluevia Fibra had signed a binding five year contract for fibre wholesale
in Spain. The new contract will be operational from 1 January 2025 and
replaces the current fibre wholesale agreement which expires at the end of
this year. The new terms will deliver significant economic benefits to
Vodafone Spain alongside enhancing core operational processes and improving
the customer experience.
On 7 November, Zegona announced that Vodafone ONO, S.A.U. and Telefónica de
España, had signed a binding contract to create a new fibre network company
in Spain. This new FibreCo will cover 3.6 million premises across Spain,
providing fibre access services for 1.4 million Vodafone Spain and Telefonica
customers. Vodafone Spain will use FibreCo to provide services to its existing
and future retail and wholesale customers within its footprint. The FibreCo is
expected to have run rate EBITDA of circa €125 million after 3 years. The
ownership split of the company will be 63% Telefonica and 37% Vodafone Spain.
2. Key performance indicators (KPIs)
Reported Comparative
Vodafone Spain 3m to Sep 24 3m to Jun 24
Operational KPIs
EoP 000s
FBB lines 2,755 2,731
Mobile lines 13,528 13,406
Financial KPIs
€'m €'m
Total Revenues * 903 916
EBITDAaL** 318 299
EBITDAaL** less capex 174 141
Zegona Holdco Group 30 Sep 24 30 Jun 24
€'b €'b
Long term indebtedness 3.8 3.8
* "Year-on-year" total revenue is not a meaningful comparison as the
acquisition created discontinuity in how revenue has been recognised. Only a
comparison of underlying revenue which adjusts for such items is meaningful.
Total Revenues in the table above aggregate to €1,819m (Note only
post-acquisition Vodafone Spain revenue of €1,205m for the four months is
included in the Group's consolidated income statement).
** EBITDAaL is defined as earnings attributable to the Vodafone Spain
operating group of companies before income tax credit, net financing costs,
amortisation of customer-related intangible assets, amortisation of owned
assets and depreciation of owned assets, excluding gains/losses on disposal of
owned and leased assets, restructuring costs, other income and expense and
significant items that are not considered by management to be reflective of
the underlying performance, including the impacts of depreciation and gain on
disposal of leased assets and interest on lease liabilities, and adjusted in
line with Zegona Communications Plc.'s accounting policy relating to
subscriber acquisition costs.
3. Zegona Holdco Group
Consolidated statement of comprehensive income
6 Month*
Period to
30 Sep 24
€'m
Note
Revenue 1 1,205
Cost of Sales (353)
Gross profit 852
Operating and administrative expenses (776)
Operating exceptional Items (135)
Operating profit (59)
Finance income 12
Finance cost (166)
Loss for the period before tax (213)
Income tax expense -
Loss for the period (213)
* Six months of Zegona Holdco Limited Group's consolidated results include
four months of Vodafone Spain (post acquisition)
Consolidated statement of financial position
As at
30 Sep 24
Assets €'m
Non-current assets Note
Property, plant and equipment 2 3,702
Goodwill 391
Intangible assets 3 1,991
Trade and other receivables 271
6,355
Current assets
Trade and other receivables 832
Inventory 44
Cash and cash equivalents 120
996
Total assets 7,351
Equity and Liabilities
Equity
Share capital -
Share premium 1,190
Retained earnings (303)
887
Liabilities
Non-current liabilities
Trade and other payables 240
Deferred tax liabilities 49
Long term borrowings 4 3,825
Lease and other liabilities 803
4,917
Current liabilities
Accruals and other payables 5 1,184
Lease and other liabilities 363
1,547
Total liabilities 6,464
Total equity and liabilities 7,351
4. Zegona Holdco Group - Footnotes
Footnotes to condensed financial information:
These condensed, unaudited financial information footnotes do not include all
the information and disclosures required in the annual financial statements
nor the interim financial statements, and as such should be read in
conjunction with the relevant publications reflecting the consolidated Zegona
Communications Plc. results, which are available on their website,
www.zegona.com. However, selected explanatory notes are included to explain
events and transactions that are significant to an understanding of the
changes in the Zegona Holdco Limited Group's financial position and
performance.
Basis of preparation:
Subsidiaries (see below) are defined as entities controlled by Zegona Holdco
Limited ("the Company") either directly or indirectly. Control exists when the
Company is exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power
over the entity. The financial information of subsidiaries is included in
these financial statements from the date that control commences until the date
that control ceases and are listed below.
Intragroup balances, any gains and losses or income and expenses arising from
intragroup transactions, are eliminated on consolidation. These financial
statements have been prepared under the historical cost convention except for
certain financial assets that were measured at fair value (mainly the Purchase
Price Allocation "PPA" valuations).
As noted in the consolidated Interim Financial Statements for Zegona
Communications Plc., the PPA was still provisional and will be finalised in
their annual Financial Statements.
Note 1:
Revenue presented in the Consolidated statement of comprehensive income for
Zegona Holdco Limited includes four months of the Vodafone Spain Group
consolidated results, from the acquisition date of 31 May 2024.
Note 2:
Property, plant and equipment mainly relate to Equipment, fixtures and
fittings (€2,784m), Land and buildings (€100m) and Right of use leased
assets (€818m).
Note 3:
Intangible assets predominantly relate to the Brands (€360m), Software
(€237m), Licence and spectrum assets (€657m) and Customer related assets
(€737m).
Note 4:
Long term borrowings relates to the external debt held by Zegona Holdco
Limited and certain subsidiaries. This mainly comprises Term Loan A of
€0.5bn, €1.3bn and $0.9bn of Senior Secured Notes, and €0.9bn and $0.4bn
Term Loan B. The total debt is presented net of capitalised financing costs.
The revolving credit facilities of €0.5bn are available but unused.
Note 5:
Current accruals and other payables mainly consist of Trade payables
(€551m), Accruals (€296m), Other payables (€270m) and Other taxes &
social security payables (€67m).
Subsidiaries Jurisdiction
Zegona Holdco Limited UK
Zegona Finance Plc. UK
Zegona Finance LLC US
Zegona BidCo SLU ES
Vodafone Holdings Europe SLU ES *
Vodafone España SAU ES *
Vodafone Ono SAU ES *
Vodafone Servicios SAU ES *
Vodafone Energia SAU ES *
VTOR America ES *
* Included in Vodafone Spain operating Group
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