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Digi Comms now makes 72% of its revenues in Romania

The precise results of Romania’s Digi Communications, which runs alternatively as RCS&RDS in some counties and Digi TV in others, have often mystified us and led to begging Google Translate to get to grips with Romanian. This week for the first time it showed its results in English and showed how battle scarred it is, boasting a TV ARPU of just €5.2 a month and a broadband ARPU of even less at €5. Yet the company continues to make money in its native Romania.

Over the years Digi has closed businesses in far flung parts of Europe – getting out of Slovakia, the Czech Republic and Croatia – and invested instead back in its home country, mostly to shift from being a cable operator to building a quad play, which now includes 3.4 million mobile customers.

And while it still has businesses in Hungary and also fresh businesses in Italy and Spain, Romania today makes up 72% of its total business, and Hungary some 16% leaving 10% in Spain and a tiny 2% in Italy. Revenues for the half year to the end of June came out at €454 million, with EBITDA of €140 million. Net debt has risen to €763 million, from just €661 million two years ago, but only up a fraction from last year. It reported a low capex spend of just €52.9 million for the quarter, after spending €67.6 last quarter.

It pay TV subscribers in Romania, after the longest and most bloody price war in the entire of Europe, are 2.9 million cable TV customers and 618,000 DTH. Five years ago they were just 2.6 million combined, roughly half and half the two formats, so over that time Digi has added around 900,000 pay TV customers. This is in a market of some 7.3 million households, with both Deutsche Telekom’s Romtelecom and Liberty Global’s UPC making up a similar number between them.

In Hungary Digi has 485,000 cable TV customers and a further 306,000 DTH subscribers, and in Spain it only has mobile customers. Broadband customers in Romania have reached 2.2 million, and in Hungary some 447,000.

Two weeks ago we reported that Digi Communications has posted an update to its investigation regarding corruption allegations, reporting that several executives accused of bribery and money laundering will appear in court. The Bucharest Tribunal, triggered by the Romanian Anti-Corruption Directorate (DNA), will feature four board members from Digi subsidiaries RCS&RDS and Integrasoft regarding two real estate assets valued at approximately €3 million.

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