Top 10 Revenue Q124
Big increase in revenues for China Mobile and NTT while US operators all show a decline from Q423. China mobile had the highest revenues in Q124 overtaking Verizon who drops to #2.
AT&T drops to Number 5 in the Global ranking having been overtaken by Deutsch Telekom and Comcast.
Top Telco for 2023 based on Kpilog analysis
Results of our analysis to identify the highest ranking Telco in 2023.
One of our primary goals in establishing this service was to identify and rank telecommunications companies based on their performance—a challenging but worthwhile endeavour, we believe. Telco operators reporting often highlights the positives while minimizing the underlying performance challenges and our goal is to enable industry wide benchmarking and peer comparisons for our customers.
Now how to do this?
Ultimately, it was determined that no single metric could capture the comparative performance of global Telcos. Therefore, we decided to rank each Telco we monitor across seven different metrics and then sum these rankings to obtain a cumulative performance ranking.
We understand you may not agree with our metrics, but we believe it's a reasonable broad-brush approach and serves to prompt a conversation for those who wish to engage. Additionally, we allow our customers to customize which metrics are included based on their personal preferences and based on feedback we will evolve the analysis to include additional metrics over time.
So to cut to the chase the 7 metrics we chose are as follows;
Operating income margin - a universal metric which is reasonably standard across different accounting standards - we exclude any once-off profits related to sale of assets.
Pretax profit margin - again excluding once-off gains
Free Cash Flow margin - includes Capex and Lease/ROU as well as any spectrum purchases - usually CFFO-Capex-Lease or ROU- Spectrum
Operating free cash flow margin - usually EBITDA-Capex - ROU/Lease costs, this is not a very comparable metric due to the differing EBITDA calculations that abound but fit for purpose we believe.
ROA - Return on assets - Total assets/12 months Net income
ROIC = 12 month NOPAT(Net operating income after tax)/Invested capital(Total debt + Shareholder equity)
EBITDA margin - beloved by many but hated by as many!. We had to include this but comparability is difficult from a Global perspective and arbitrary reporting by Telcos for a KPI which has no standard IFRS or GAAP definition.
The analysis is done based on a calendar year and it requires that we wait until mid-year to get some full year reports from Telcos whose financial year end in March or June
We track revenue and operational metrics like subscriber numbers, but ultimately, we believe these elements should not be included. As is commonly understood, growth in subscribers or revenue does not necessarily equate to profit growth.
2023 Kpilog.com Top Telco Global ranking - graphics are not great but they should be self-explanatory
The Global top 3 all come from our AAPAC region.
1. Grameenphone has long been an established leader in the Bangladeshi market and benefits from market leading position in a densely populated country of 173m
2. MTN Ghana is an effective monopoly in the 3 operator Ghanaian market accounting for over 75% of revenues and subscribers within the market.
3.Converge is a relative newcomer in the Filipino broadband market and a rapid FTTH rollout in recent years has contributed to significant revenue and subscriber growth while profit margins have been maintained.
2023 Kpilog.com Top Telco Americas ranking
1. DTH operators are usually high margin with strong cash flows and Telesat is a leader in this regard who has managed to maintain its revenues across North and South America as well as in Europe in the face of an increasingly competitive market.
2. Crown Castle is a long established Towerco with a low cost base and high quality tenants in the North American market with a market leading tenancy ratio of 2.5 at EOY 2023 - no major international expansion in recent years which has helped to maintain the healthy profit margins.
3. Cable One is an established broadband provider with over 1m customers who has managed to maintain its margins despite a declining penetration of homes passed and cord-cutting by its TV subscribers.
2023 Kpilog.com Top Telco Europe ranking
11. Inwit Italy is a leading Towerco in Italy, having been established through the merger of Telecom Italia and Vodafone's towers. With an improving tenancy ratio of 2.23 at the end of 2023, it stands as a highly profitable entity.
2. The Cetin Group represents another significant infrastructure presence across Central European nations such as the Czech Republic, Bulgaria, Hungary, and Serbia. It boasts a varied range of both active and passive services catering to fixed broadband and mobile operators within these regions.
3. KPN holds its ground as the incumbent market leader in the Netherlands, successfully retaining its market position amidst intense competition by focusing on its home market in recent years.
