Alphavalue | A third of Spanish telco Telefonica’s board has bought shares since the fall of August. The investment is around € 26 million, led by Francisco Riberas. Pallete, Echenique, García Blanco, Vilá and Carvajal have also acquired titles.
Telefónica’s decision to reduce its reliance on Huawei is in line with the company’s strategy to have several different providers for the equipment for its 5G networks, which is expected to be widely deployed by 2022.
Renta 4 | We made a change in the Portfolio letting Telefónica (TEF) go, and MásMóvil (MAS) in, since the second has a much higher revaluation potential supported by its greater growth, double digit in revenue and expanding its operating margins, estimating that it will continue to be the operator with the highest share in the coming years.
Renta 4 | Telefonica shares hit their lowest level in August since 2006, since when they have recovered more than +10%. We see that investors have turned their back on the operator, disappointed by a business evolution which has not improved at an operational level and lacking confidence in a significant and sustained improvement in the future.
Renta 4 | Telefonica´s Council decided to propose a new plan of incentivised redundancies in terms similar to those already discussed in the market. Telefonica has provisioned 1.6 Bn€ to finance the redundancy of some 3,000 workers.
The four mobile operators in Germany have signed a declaration of intentions with the government and local authorities to roll out the LTE network at national level. Telefonica Germany will construct 333 new mobile installations by the end of 2021. As compensation, the government has committed itself to improve the method of payment for the 5G licences auctioned in June.
Telefonica is considering selling mobile and towers and fibre cables to its subsidiary Telxius (50.01%9 with the aim of giving greater visibility to the value of these assets, taking account of the major recognition telecommunications infrastructure is receiving in the markets.
Telefonica published its Q219 results. According to Bankinter market watchers, they are slightly better than expected: Income +0% to 12.142 Bn€ vs 11.981 Bn€ expected by the consensus. Operational profits -12% to 1.802 Bn€ vs 1.755 Bn€. Net profits -4.5% to 862 M€ vs 880 M€. Net debt 40.230 Bn€ vs 40 Bn€.
The German auction of 5G frequencies ended this week. Telefonica’s subsidiary in Germany was awarded a total 90MHz, for a cost of 1.425 Bn€, 22% of the total raised by the auction of 6.55 Bn€, higher than the expected 5 Bn€. Telefonica Deutschland was awarded 2 blocks in the 2GHz band and 7 blocks in the 3.6 GHz band. The assignment of the 2 GHz block will happen on 1 January 2021 and the other on 1 January 2026.
Telefonica’s dividend payment of 0.40 eur per share in cash will be divided into two payments of 0.20 euros / share.