On Friday, May 15th, Digi Communications NV Group published its financial results for the first quarter ended March 31st, 2020, increasing revenues by 11% compared to the same period of previous year (from EUR 281.2 million to 313.2 million EUR) and achieving 9% RGU growth, up to 16.5 million. Adjusted EBITDA was EUR 114.7 million (including IFRS 16), 26.4% increase compared to previous period.
Digi Group delivered a strong overall performance in the first quarter of 2020. Given the general public health context, since mid-March, the company focused on responding the pandemic and the restrictive measures taken by authorities in all the territories where it operates. In Romania, this started on the 23rd of March 2020, in Hungary, the 11th of March, in Spain, the 15th of March, in Italy, the 12th of March.
Digi Communications N.V. successfully implemented measures to ensure the health and safety of customers, employees and partners and the reliable delivery of services during the COVID-19 outbreak, aiming to run operations with minimum disruption. Given the unpredictability associated with the pandemic, its duration and its immediate economic impact, it is difficult at this early stage to quantify the overall financial effects on the business.
During the period of restriction, in Romania, we have seen an increase of usage for fixed internet and cable TV services for residential customers. The demand of new connections and the significant shift to working from home contributed to a sustained request of fixed services. This pattern was also reflected in the increase of traffic by 20-30% especially in the second half of the day.
As a result, at the end of the quarter, Digi achieved an increase of RGU on the main segments (fixed internet and cable TV) to an historic level of 3.7 million RGU (cable tv), respectively 2.9 million RGU (fixed internet).
In Hungary, despite the different type of restrictive measures implemented, there was no significant negative impact during the period, which remained in line with normal business periods.
In Spain, the pace of RGU growth changed significantly, following the portability for mobile and fixed telephony restrictions implemented during this period. Digi Spain succeeded, in the first quarter of the year, to exceed the threshold of 2 million RGU for mobile voice and data services and improved its contribution to the Group`s revenue (20% out of total Group revenue) and EBITDA (11% out of total Group EBITDA).
“In the last two months, our management team’s top priority was to ensure the health and safety of our employees as well as our customers and ensuring the supply of the necessary protective equipment for the teams. We have also worked hard to prevent any delays in the supply chain, have continued to develop technical facilities and been cautious to preserve liquidity. Confronted with restrictions, in all our territories and with significant changes of customers behavior, our teams focused on maintaining the same quality level of services at all times. Our fixed and mobile networks in Romania successfully supported the traffic increase, up by 30% (fixed) and 11% (mobile), in March compared to February. Corporate sales teams adapted their commercial strategies to a new reality and prioritized client support activities in order to provide the appropriate assistance to B2B clients affected by the crisis.
“We are grateful for the outstanding flexibility and pro-active attitude of all our employees. Thanks to their rapid reaction and discipline, the company continued to fulfil its clients demands and succeeded to support communities, families and individuals affected by the crisis. Dedicated to our mission as a long-term partner for the society and municipalities of Romania, Digi contributed with approximately EUR 1.7 million to donations consisting in medical equipment or connectivity services to Romanian hospitals, students, rural communities or volunteer initiatives aiming to support vulnerable population”, said Serghei Bulgac, Chief Executive Officer (CEO) of Digi Communications N.V.