{"id":23695,"date":"2020-09-03T00:01:52","date_gmt":"2020-09-02T23:01:52","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=23695"},"modified":"2020-09-03T07:20:11","modified_gmt":"2020-09-03T06:20:11","slug":"rural-isp-gigaclear-ends-year-with-129000-full-fibre-uk-premises","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2020\/09\/rural-isp-gigaclear-ends-year-with-129000-full-fibre-uk-premises.html","title":{"rendered":"Rural ISP Gigaclear Ends Year with 129,000 Full Fibre UK Premises"},"content":{"rendered":"

Rural broadband ISP Gigaclear<\/a>, which is deploying a gigabit-capable Fibre-to-the-Premises (FTTP<\/a>) network to some of England’s remotest communities, are aiming to pick-up the build pace in 2020 after they reported a total network reach of 129,000 premises (up by 36,000 in the year) and 24,000 customers (up 26%).<\/p>\n

We should point out that the network passed figure of 129,000 – for the end of December 2019 – doesn’t tell the whole story, since the pots figure for properties that are actually “ready for service<\/em>” is now 97,600 (up by 31,600 in the year). Broadly speaking this reflects a similar level of network expansion to what we saw in the previous year’s results (here<\/a>).<\/p>\n

The latest results<\/a> also follow several months after the provider secured \u00a3525m<\/strong> in debt financing to help drive a new long-term build strategy (here<\/a>). We recall that Gigaclear<\/a>’s previous ambition was to cover 350,000 rural premises with FTTP<\/a> by the end of 2021, which would then rise to 500,000 by 2025, but today’s report confirms that they’re now aiming to cover “500,000+ rural properties by 2023<\/em>.”<\/p>\n

Arguably the last year has thus been all about recovering, regrouping and reorganising from the loss of their CDS contract in Devon and Somerset (here<\/a>), as well as the significant build delays that have afflicted their other projects under various state aid supported Building Digital UK<\/a> contracts. Hopefully this means we’ll see their build ramp-up in time for next year’s report, although COVID-19 might have some impact on that.<\/p>\n

NOTE:<\/strong> By design the ISP builds in less competitive (rural) areas, where only BT<\/a>’s slow copper tends to exist. Gigaclear<\/a> said there are at least 1 million homes “in our footprint which satisfy our screening requirements<\/em>.”<\/div>\n

Gigaclear’s Outlook<\/strong><\/p>\n

“In 2019 we made tremendous progress towards our goal of preparing Gigaclear to make a step change in output. We will continue to transform Gigaclear throughout 2020 and we will continue to work with and onboard new contractor partners and innovate the way we build our networks.<\/p>\n

Our goal for 2020 is to progressively step up our delivery of homes passed at economically viable prices and to continue to grow our customer base, whilst providing excellent service to our existing customers.”<\/p><\/blockquote>\n

In terms of investment, we did ask Gigaclear if they expected to need any further funding in order to achieve the aforementioned 2023 target. In response the provider said, “We have supportive shareholders and now a supportive group of banks, however the funding is part of our five year plan and we do not expect to be seeking any additional funding.<\/em>”<\/p>\n

On the subject of that CDS contract, the report reveals that they incurred a number of costs related to its termination. “We booked a provision of \u00a30.9m, an amount we expected to pay as a settlement in relation to the contract termination. Furthermore, we additionally assessed, that without the CDS subsidies, a number of our assets and projects in CDS were no longer economically viable. Consequently, we took an asset impairment charge of \u00a35.4m and wrote off approximately \u00a30.6m of development costs<\/em>,” said Gigaclear before confirming that their operating expenses for the year had grown to \u00a340.9m (2018: \u00a330.0m).<\/p>\n

Highlights of the Annual Report (Results to Dec 2019)<\/strong><\/span><\/p>\n

* Net assets at the year-end were \u00a3184.6m (2018: \u00a3133.5m).<\/p>\n

* The employee count has jumped to 337 (2018: 272).<\/p>\n

* The network passed 129,000 properties at year-end, an increase of 36,000 properties.<\/p>\n

* Pots \u2018ready for service\u2019 increased to 97,600, an annual rise of 31,600 properties.<\/p>\n

* 24,000 customers with growth of 26% (2018: 19,000 with growth of 30%).<\/p>\n

* A nice rise in revenue of \u00a311.3m (2018: \u00a39.0m).<\/p>\n

* Consolidated loss for the year was \u00a333.8m (2018: loss of \u00a327.4m)<\/p>\n

* Operating expenses of \u00a340.9m (2018: \u00a330.0m).<\/p><\/blockquote>\n

Like many new full fibre operators, losses are to be expected as you have to spend quite a few years burning money on the build and then getting a payback via customers takes awhile (payback periods of 15 years+ are not uncommon in this industry). “The company is still very much in its growth phase and it is expected that we will continue to report losses in the near to medium term as the business scales<\/em>,” said Gigaclear.<\/p>\n

As it stands the provider’s network is already present in over 200 rural communities and covers parts of more than 22 counties across the South West, the Midlands and the South East of England. Broadly speaking the operator now believes that they’ve “put in place the necessary foundations to achieve our long-term goal of becoming the UK\u2019s leading alternative provider of full fibre networks in rural communities.<\/em>”<\/p>\n

Finally, the report doesn’t really cover their legal dispute<\/a> over one of the Scottish Government<\/a>’s R100 contracts, but that issue has now been settled (here<\/a>).<\/p>\n","protected":false},"excerpt":{"rendered":"

Rural broadband ISP Gigaclear, which is deploying a gigabit-capable Fibre-to-the-Premises (FTTP) network to some of England’s remotest communities, are aiming to pick-up the build pace in 2020 after they reported a total network reach of 129,000 premises (up by 36,000 in the year) and 24,000 customers (up 26%).<\/p>\n","protected":false},"author":1,"featured_media":23696,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1],"tags":[56,416],"class_list":["post-23695","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk_isp_news","tag-fttp","tag-gigaclear"],"share_on_mastodon":{"url":"","error":""},"yoast_head":"\nRural ISP Gigaclear Ends Year with 129,000 Full Fibre UK Premises - ISPreview UK<\/title>\n<meta name=\"description\" content=\"Rural broadband ISP Gigaclear, which is deploying a gigabit-capable Fibre-to-the-Premises (FTTP) network to some of England's remotest communities, are\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ispreview.co.uk\/index.php\/2020\/09\/rural-isp-gigaclear-ends-year-with-129000-full-fibre-uk-premises.html\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Rural ISP Gigaclear Ends Year with 129,000 Full Fibre UK Premises - 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