CT’s CEO Jaime Smith said that Telefonica does not plan to de-list CT, which would be in line with our expectations. Note that TEF holds 69.4% in CT. Smith added that TEF does not plan any acquisitions in the region in the near future, but will nevertheless analyze any opportunities. Any acquisition could be made directly by TEF or via CT, subject to size. According to Smith, an acquisition in the region would bring synergies to the group. No decision regarding dividend payments next year has been made so far. We continue to highlight CT’s ability to generate strong free cash flow and its low leverage of 0.18 (D/E). We expect CT to pay a dividend of CZK 40+/share next year.
Separately, CT has announced that it will not hire an external company for its network maintenance. On the other hand the company wants to press ahead with the sale of non-core real estate with a total book value of CZK 10bn. CT also plans to launch TV via phone to fight the erosion of fixed line revenues and fixed line disconnections.