KPN announces fourth-quarter and full-year results 2022

Joost Farwerck, CEO, on the results:

“We are proud to have delivered on our 2022 outlook and ambitions. Throughout the year, we have consistently grown our Group service revenues, a clear proof point of the success of our strategy which is aimed at sustainable growth. Business service revenues grew for the third consecutive quarter, displaying momentum and we are confident that our Business segment has reached an inflection point. In Consumer, our fibre service revenues and mobile service revenues showed continued growth, partially offsetting challenging competitive dynamics in the wider broadband market. Supported by our open access policy, the Wholesale segment continued to show growth. Whilst cost progress was affected by increased energy prices and one-off allowances to our staff, we achieved strong underlying productivity growth. Together with improving service revenue trends, cost savings enabled us to protect our margins, deliver solid EBITDA growth and exceed our guidance in terms of Free Cash Flow delivery.

The investments we do in our networks and services are paying off, with both the Umlaut and Ookla benchmarks recognising KPN as best mobile network. Alongside this we’re also recognised as best All-in-1 broadband provider, a great sign of appreciation from customers for our products and services. We also kept expanding our fibre footprint, and together with Glaspoort, we passed a record number of fibre households. Jointly, we now cover almost half of the country with fiber and we see more and more customers benefiting from this next generation digital infrastructure. In a world increasingly dependent on digital interactions, the stability and reliability of our networks are fundamental and the importance of cyber security is becoming more evident every day, which is why we continue to put security first. These achievements would not have been possible without the continued determination and expertise of our people, who do everything in their power to connect everyone in the Netherlands to a sustainable digital future. Employee engagement remains at an elevated level and colleagues continue to express their involvement and pride to work at KPN. In December, we agreed on a new collective labor agreement for 2023, which contains several aspects that support our employees with the rising cost of living.

We are fully committed to creating sustainable long-term value for all our stakeholders. I am therefore proud that KPN is once again recognised as one of the companies that are global climate leaders and are at the forefront of reducing CO2 emissions and mitigating climate change, according to the Carbon Disclosure Project (CDP). Moreover, in 2022 we signed an agreement with Eneco for the purchase of wind energy from 2027, which is aligned with KPN’s ambitious sustainability targets and de-risking our long-term energy price exposure.

Although we are facing a difficult macro-economic environment with wage indexation and rising energy costs likely to affect our cost savings run rate, the measures we have put in place provide us with confidence in our ability to maintain healthy margins and a growing Free Cash Flow. This, combined with our strong financial position, enables us to grow shareholder returns for 2023 through a growing dividend and new share buyback.”