• Revenue: EUR41.5 billion for the nine months of 2024, up 1% year-on-year.
• Net Profit: EUR687 million, slightly higher compared to the nine months of 2023.
• Net Debt: EUR8.5 billion at end September 2024, improved from EUR10.2 billion at end September 2023.
• Construction Backlog: EUR31.8 billion at end September 2024, up 7% year-on-year.
• Current Operating Profit from Activities: EUR1,719 million, increased by EUR96 million year-on-year.
• TF1 Sales: Up 3% year-on-year for the nine months of 2024.
• TF1 Advertising Revenue: Up 5% year-on-year.
• Bouygues Telecom Sales to Customers: Up 5% year-on-year.
• Bouygues Telecom EBITDA After Leases: EUR1,506 million, increased by EUR55 million year-on-year.
• Free Cash Flow Before Working Capital Requirements: EUR919 million, improved by EUR254 million year-on-year.
• Liquidity: EUR13.9 billion, including EUR2.7 billion in cash and equivalents.

• Warning! GuruFocus has detected 7 Warning Signs with BOUYF.

Release Date: November 05, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Bouygues (BOUYF) confirmed its 2024 outlook, indicating confidence in its strategic direction.
• The construction business backlog reached a high level of EUR31.8 billion, up 7% year-on-year, providing strong visibility for future activities.
• Bouygues Telecom achieved a 5% growth in sales billed to customers year-on-year, with a strong performance in fixed services.
• The financial structure remains robust with a net debt of EUR8.5 billion at the end of September 2024, an improvement from the previous year.
• TF1 group sales increased by 3% year-on-year, with media sales up 4% and advertising revenue up 5%.

Negative Points

• Bouygues (BOUYF) faces a challenging market environment with low visibility on the timetable for recovery, particularly in the construction sector.
• The net profit attributable to the group was slightly higher than the previous year, but future tax increases could impact profitability.
• Bouygues Telecom's mobile ARPU declined due to competitive pressures and customer migration to more affordable plans.
• The construction business's current operating profit from activities was lower than the previous year, impacted by a decrease in Bouygues Immobilier's contribution.
• The French residential and commercial property markets remain challenging, affecting Bouygues Immobilier's backlog, which was down 18% year-on-year.

Q & A Highlights

Q: Can you provide any offsets or cost-cutting actions to limit the impact of the new tax on free cash flow in 2025 and 2026? A: Pascal Grange, Deputy CEO and CFO, stated that while they are optimizing their organization, there are no specific actions planned to mitigate the new tax charge this year.

Q: Why did Bouygues Telecom launch the BNU pure fiber offer when net additions seem on track and ARPU is stable? A: Olivier Roussat, CEO, explained that the BNU offer targets a specific segment of digital customers who prefer high-performance connectivity without additional services like TV or fixed-line telephony. This offer is designed to cater to a niche market, estimated to be around 10% of the market.

Q: What is driving the strong margin improvement at Equans, and is it sustainable? A: Pascal Grange noted that the margin improvement is due to the successful execution of their strategic plan, including better pricing and contract selectivity. While the trend is positive, the margin improvement may not be consistent every quarter.

Q: How is Bouygues Telecom's new brand, Big, performing since its launch? A: Olivier Roussat mentioned that it is too early to draw conclusions, but the initial commercial launch was successful. The main goals are to reduce churn and attract more exclusive household customers, which will take time to achieve.

Q: Can you explain the impact of the Olympics on Bouygues Telecom's roaming revenues? A: Olivier Roussat stated that there was a small positive impact in July due to the Olympics, but overall, the roaming revenue for the year was slightly lower than in 2023.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.