Group Sales: EUR12.6 billion, up 2.2% year-on-year. Net Result Attributable to the Group: Minus EUR156 million, including an exceptional income tax surcharge of EUR33 million. Net Debt: EUR7.1 billion, an improvement of EUR645 million year-on-year. Construction Backlog: EUR34.2 billion, up EUR3.8 billion year-on-year. Equans COPA: EUR177 million, with a COPA margin of 3.8%, up 0.9 points year-on-year. Colas Sales: EUR2.7 billion, up 3% year-on-year. Bouygues Telecom Fixed Customers: 5.2 million, with 148,000 new FTTH customers in Q1. Bouygues Telecom Mobile Plan Customers: 18.3 million, with 63,000 new customers in Q1. TF1 Group Sales: Up 2% year-on-year, with media sales up 2% and TF1+ up 37%. Liquidity: EUR14.8 billion, including EUR3.8 billion in cash and equivalents.

Warning! GuruFocus has detected 12 Warning Signs with BOUYF.

Release Date: May 14, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Bouygues (BOUYF) confirmed its group outlook for 2025, with group sales and COPA both up year-on-year. The construction backlog reached a record level of EUR34.2 billion, up 12% year-on-year, providing good visibility on future activities. Net debt improved by EUR645 million year-on-year, despite significant acquisitions, indicating strong financial management. Bouygues Telecom achieved a 6% growth in sales billed to customers year-on-year, driven by strong performance in the Fixed segment. Equans showed significant improvement with a COPA margin increase of 0.9 points to 3.8%, reflecting successful execution of strategic plans.

Negative Points

The net result attributable to the group was negatively impacted by an exceptional income tax surcharge, leading to a net loss of EUR156 million. Bouygues Telecom's EBITDA after leases decreased due to higher energy costs and increased IFER tax on mobile sites. The macroeconomic environment remains uncertain, affecting the pace of growth in certain segments like giga factories and data centers. Bouygues Immobilier's backlog remains low, reflecting a challenging market environment. The Fixed ABPU growth rate is expected to slow down in 2025 compared to previous years.

Q & A Highlights

Q: Can you provide insights into the current telecom market, particularly regarding pricing pressures in mobile and fixed segments? A: Christian Lecoq, Bouygues Telecom SA - CFO: The mobile market is less dynamic with slight growth and sustained competition in the low-end segment. We initiated an upward trend in tariffs, but not all competitors followed. In the high-end, our new marketing strategy has reduced churn and improved customer satisfaction. In fixed, we are gaining market share, especially in rural areas, due to our strong network quality.

Story Continues

Q: How is the synergy extraction and margin improvement progressing at Equans? A: Pascal Grange, Bouygues SA - Deputy CEO and CFO: We are implementing a strategic plan focusing on pricing, purchasing, and productivity improvements. This has led to gradual margin improvements, with a target to reach a 5% margin by 2027. We are optimistic about achieving slightly higher margins than previously guided for 2025.

Q: Are there any impacts from tariffs on Equans or construction businesses? A: Pascal Grange, Bouygues SA - Deputy CEO and CFO: There is no significant impact from tariffs as our operations are largely localized. The main concern is the global economic environment, which remains uncertain.

Q: Could you elaborate on the slowdown in certain market segments for Equans in Q1? A: Pascal Grange, Bouygues SA - Deputy CEO and CFO: The slowdown is due to a wait-and-see approach in segments like giga factories for batteries and data centers, where technological advancements and policy changes are causing delays in decision-making.

Q: What is the outlook for Bouygues Telecom's fixed ABPU growth? A: Christian Lecoq, Bouygues Telecom SA - CFO: Fixed ABPU growth will continue in 2025 but at a slower pace than previous years. This is due to the end of DSL and WiFi 5 commercialization and the introduction of new technologies at higher prices, along with the impact of our B&YOU offers.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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