Odido Group Holding B.V.

Overview Key strengths Key risks Strong position in the Dutch mobile market, with a No. 2 position in the total mobile market and a No. 1 position in the consumer postpaid market. Highly leveraged, with an S&P Global Ratings? ratio of adjusted debt to EBITDA of more than 5.5x, stemming from an aggressive financial policy. Strong multi-brand portfolio and leading spectrum position in the country. Dependency on third-party fixed network infrastructure for fixed line services. Operates in a rational but competitive three-player market, with no foreseeable risk of another operator entering. Odido faces competition from two larger fully integrated players. Capex to remain at peak level in 2024, leading to a temporary dip in S&P Global Ratings-adjusted FOCF-to-debt ratio of

... are expected throughout 2024, which will lead to pressure on free operating cash flow (FOCF). We forecast that Odido Group Holdings B.V.'s capex (excluding spectrum) will remain at about 18%-20% of revenue in 2024 (similar to the about 19% in 2023), as the company accelerates investments to rollout 5G, densify the network, and swaps equipment relating to a change in vendor. We also anticipate that Odido will participate in the upcoming 3.5 gigahertz spectrum auction, which is likely to take place in the second quarter of 2024; we expect the cash payments for the spectrum will be paid during 2024. As a result, we project the company's free cash flow to remain limited at 1.5%-3.0% of debt over the coming 12 months, translating to S&P Global Ratings-adjusted FOCF of 120 million-140 million in 2024, before significantly improving toward 400 million-420 million in 2025. We expect capex levels to normalize and trend toward 10% of sales in 2025,...

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