Altnet UK Broadband Provider Fibrus Summarises Financial Results
Infracapital-backed network provider Fibrus, which is busy rolling out their gigabit-capable Fibre-to-the-Premises (FTTP) broadband ISP network across rural parts of Cumbria (England) and Northern Ireland, has published a limited preview of their latest financial results for 2024 – showing a 58% increase in revenues and a 143% increase in connected customers.
The operator, which has already built their full fibre network to cover 400,000 UK premises (up from 375k on 26th Aug 2024), has previously claimed to be “fully funded to complete” their roll-out plan for 500,000 premises in the near future (here) and last month passed the 100,000th customer mark (here).
At the time of writing we couldn’t find a full copy of Fibrus’ latest 2024 accounts on Companies House (here or here) and the provider didn’t include one alongside today’s announcement. But they have provided a summary that covers some selected highlights from their upcoming release.
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Fibrus’ 2024 Accounts
- 58% increase in revenues to £17.6m from £11.1m; the company experienced a record breaking year for customer growth reporting a 143% increase in connected customers, which grew by 46k during the year from 32k to 78k and have passed the 100k milestone subsequent to year end. Customer penetration now exceeds 25%.
- 64% increase in gross profit to £6.1m from £3.8m as revenue growth exceeded the increase in direct costs.
- EBITDA loss increased to £7.2m from £3.2m due to the increased investment in customer acquisition and maintaining our growing customer base. The company expects to be at EBITDA breakeven during the current financial year.
- Capital invested in infrastructure for the year was £153m from £142m, the number of premises which can connect to the Fibrus network increased by 100k during the year to 353k at 31 March 2024 and have subsequently passed the 400k milestone. Our total investment in fixed assets stood at £412m at 31 March 2024.
- The investment in infrastructure has been financed by an increase of £70m in third party debt and £41m in funding from shareholders.
- Subsequent to the end of the financial year the Company secured a £100m extension to its senior debt facility which means it is now fully funded to complete its planned build programme.
The provider was also ranked as the fastest growing company in Northern Ireland earlier this month in the Deloitte Technology Fast 50 leaderboard. The company was elsewhere placed as second-fastest growing company on the island of Ireland.
Colin Hutchinson, Chief Financial Officer at Fibrus, said:
“Our financial results reflect the significant growth in our customer base driven by the quality of the service we are delivering to our customers, evidenced by our Trustpilot score.”
This year we passed the milestone of connecting 100K customers, and we’re nearing the end of our first Government funded project, Project Stratum, which is being delivered on time and within budget.”
The Fibrus network has made a significant contribution to regional connectivity, more so than ever over the past year, and this set of financial results are a marker of that.”
Transforming the digital infrastructure and changing the lives of the people in our communities is our number one priority and we are proud to play such a key role in democratizing broadband access for thousands of people living and working in the areas we serve.
We have big ambitions for the year ahead and are looking forward to continuing this positive trajectory for the company, our employees and our shareholders and investors, on our journey to reach half a million homes.”
However, while Fibrus have been making good progress, it’s worth remembering that they did also suffer a slowdown in build earlier this year and pulled out of the state aid supported Project Gigabit contract for the North East of England (here and here). Like all network operators, they’ve had to adapt to a difficult and highly competitive environment, where build costs and interest rates have both been on the rise.
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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£412M for 400k homes passed.
So over £1,000 per home.
25% take up rate effectively means £4,000 per active connection
Average subscription £35/month = £420 a year, not including the cost of an eero cpe.
Sorry, but I don’t see how they can ever make money with this income and debt levels?
£420 per customer on a £1000 per customer build sounds pretty good. The network will last decades, particularly the fibre itself.
Ultimately all of these providers have high debt and that’s unavoidable. It’ll likely be turned into equity at some point I suspect.
It’s £1000 per home passed, only 25% of those are customers.
Their website currently has whole home for £25 – its nuts – everyone is crazy investing in this. The investors can only double down or admit they got it terribly wrong.
Kris – they have to repay interest and debt on the whole build cost, not just the active customers. That’s over £4k per customer. I doubt the revenue is close to covering the interest which means the debt and interest get worse every month.
Based on what they’ve shared these seem good number for any altnet.
Particularly the quote:
The company expects to be at EBITDA breakeven during the current financial year.
It’s progress certainly but interest and amortisation are huge for such companies. This is basically like saying if we didn’t have to build the network we’re breaking even! Not such an amazing boast
Or to put it more bluntly: they’ve spent at least £412m (probably more by the time you include marketing etc), and from that they are only getting sales of £17.6m and no EBITDA profit – actually a loss.
More worryingly, take-up is 25%, which is already very high for an altnet. There is not much more scope to grow. There is significant overlap with Openreach assets in Northern Ireland, which has all the big name ISPs on it. The main avenue to growth is to undercut on retail price, and that’s not good for profitability either.
They do have the fibre asset in the ground, so they might be looking to exit. But who’s going to buy that at £1000+ per property passed?
Ebitda break even is interesting although pretty unrepresentative in this case. Ebitda excludes interest payments so they might break even if they don’t have to service their debt – I’ll take that deal if it’s available! In reality they will lose a lot of money for many years and will need exponential growth in top line to really break even.
If debt is £320m the debt to revenue ratio is over 18x (). If interest is 5% then they need £16m to pay the interest alone. Massively optimistic assumption they can get to 60% uptake with 400k homes passed means they will get £72m revenue (£25 arpu). Even with 50% EBITDA margin I don’t think they will be able to cover interest plus pay down the principle or pay shareholders a dividend. There simply aren’t enough customers to make the sums work at the build cost they’ve achieved. Looks like Cumbria has been an expensive mistake.
25% uptake is huge for an altnet but even 60% doesn’t look like it will be enough. What will happen to all that taxpayer money????