Cellnex Telecom, Europe’s largest operator of wireless telecom infrastructure, has unveiled its growth strategy at its Capital Markets Day held in London, UK.
The event saw the participation of Cellnex’s Chairperson, Anne Bouverot, accompanied by the Executive Leadership Team including Marco Patuano, CEO; Vincent Cuvillier, CSO; Simone Battiferri, COO; Raimon Trias, CFO; and Juan José Gaitán, Head of Investor Relations. Together, they shared updates on the next phase of Cellnex’s growth strategy and the roadmap to achieve new short and medium-term financial targets.
Next Chapter of Cellnex’s Strategy
After experiencing remarkable growth since its IPO in 2015, Cellnex committed in 2022 to a new business strategy aimed at strengthening its balance sheet, securing an Investment Grade rating (BBB-) from Standard & Poor’s, accelerating organic growth, and achieving net positive cash flow by 2024, a goal successfully attained in 2023.
Expanding on this strategy, Cellnex has outlined the next chapter of its growth story, revolving around four strategic pillars:
Simplification: Cellnex is embarking on a strategic portfolio review to concentrate on core markets and businesses, while divesting from non-core business lines with limited growth potential. This initiative aims to streamline operations, fortify the balance sheet, enhance the credit rating, and pave the way for stronger results and future organic expansion, ultimately improving shareholder returns.
Focus: Cellnex aims to prioritize co-tenancy growth, alongside Build-to-Suit (BTS) projects for its customers. The objective is to achieve a tenancy ratio of 1.64 by 2027 to maximize the value of existing assets. While towers remain the core business, Cellnex will invest in selected areas such as Distributed Antenna Systems (DAS), Small Cells (SCs), Radio Access Network (RAN) services, and wholesale fiber connectivity, aiming to increase their contribution to total revenues from 11 percent to 15 percent by 2027.
Efficiency: The company will launch a comprehensive efficiency plan to enhance the EBITDAaL margin by 500 basis points to 64 percent by 2027. This will involve optimizing lease costs, segmenting the tower portfolio, improving operational efficiency, driving digital transformation, and enhancing productivity. Lease cost optimization will be pursued through the creation of a dedicated vehicle specialized in land acquisition in selected countries, potentially involving minority investors.
Responsibility: Cellnex remains committed to strong governance and the integration of Environmental, Social, and Governance (ESG) principles within its strategic framework. The company is dedicated to achieving its ESG Strategy 2025 targets and fostering continuous improvement, solidifying its position as one of the most sustainable telecom infrastructure operators globally.
Financial Projections
Cellnex anticipates revenues, excluding pass-through, to range between EUR 4.5-4.7 billion by 2027, reflecting strong backlog and co-location trends. Adjusted EBITDA is expected to improve to EUR 3.8-4.0 billion, with EBITDAaL projected at EUR 2.85-3.05 billion, driven by reductions in operational complexity. Reflecting Cellnex’s robust operational performance, Recurring Levered Free Cash Flow (RLFCF) is forecast to be between EUR 2.1-2.3 billion, with free cash flow (FCF) expected to range from EUR 1.1 to 1.3 billion.
