Full Year 2024 Ovh Groupe SA Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Emmanuel Matot - ODDO BHF Corporate & Markets - Analyst : Three questions. First, why have you decided to implement a strategy even more focused on margins and cash generation instead of sales growth? Isn't this premature, given your limited size in this ultra-competitive sector? Second, artificial intelligence dived by 2 points, the growth of public cloud in Q4, if I understand well. It's great, but not massive. Do you expect an acceleration in fiscal year '25 or it's too early as you are only positioned on the inference segment and not on the model training segment? And last question, I understand you don't want to open many more data centers in the future, you want to leverage your current infrastructure you have. What is this utilization rate currently of your data centers? And how long will it take to reach, I would say, a great loading according to you? Thank you.

Question: Ines Mao - BNP Paribas Exane - Analyst : I have two questions. The first one is, are the midterm targets that you disclosed at the Investor Day still valid following the full year '25 new guidance?

Question: Ines Mao - BNP Paribas Exane - Analyst : Is it any better? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 8:00AM, OVH.PA - Full Year 2024 Ovh Groupe SA Earnings Call

Question: Ines Mao - BNP Paribas Exane - Analyst : Perfect. So I'm interested whether the midterm targets that you disclosed at your Investor Day in January are still valid following the full year '25 new guidance, and notably, if you see the 11% to 13% CAGR target at whether the low or the high end? And my second question is on the ARPAC in public cloud, which you say has been weaker in full year '24 in your press release because of new customer acquisition. Do you have any sense of the timing for an uptick in the ARPAC in full year '25?

Question: Adam Megyeri - Bank of America - Analyst : I've got two questions on the refinancing. First, can you give us any more commercial details on what the new facilities and the new notes will look like? I think you mentioned 5% to 5.5% interest. Could you just affirm that on the bank facility as well and whether there are any amortizations scheduled within that five-year time horizon? And the second question would be if you could give some more details on timing. I mean you said you signed the new facility, I believe, yesterday. You expect it to keep the existing capital structure outstanding until the share repurchase? Or is this all going to get drawn down and repaid, refinanced ASAP into the year-end? And similarly, on the new notes issue, right, I understand there's sort of a bridge component of the new bank facility. When do you expect to issue those new notes to take that out? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 8:00AM, OVH.PA - Full Year 2024 Ovh Groupe SA Earnings Call

Question: Adam Megyeri - Bank of America - Analyst : Okay. And just one quick follow-up on that. On the 500 -- sorry, the five-year bullet that you mentioned, so we should think of that as being effectively effective almost as of today, right? So the interest rate should step up and replace the old facility as of today effectively?

Question: Yann de Peyrelongue - Societe De Bourse Gilbert Dupont - Analyst : I have three questions, please. The first one is on utilization rate of data center. Can you give us the number at the end of 2024? And then on PaaS, could you give us the amount of IRR that you have now? I guess it was EUR19 million in Q3. And then maybe on the OPRA, the share buyback, do you have any idea of what (technical difficulty) are going to do?

Question: Yann de Peyrelongue - Societe De Bourse Gilbert Dupont - Analyst : Okay. Great. Thank you. And maybe, yes, how did you find the EUR9 target because it's only the price of the beginning of the year. So it's good compared to the low we saw in the summer, but -- REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 8:00AM, OVH.PA - Full Year 2024 Ovh Groupe SA Earnings Call

Question: Ines Mao - BNP Paribas Exane - Analyst : I hope you can hear me well. Just one follow-up question from me. You did mention in results the increased geographical availability of public cloud products. I'm just curious, are you planning to expand the sovereign cloud offering in new geographies or not? Thank you.

Question: George Webb - Morgan Stanley - Analyst : Benjamin, maybe one for you to start with and then one separate question on financials. So on that side, look, we've talked about, I guess, some of the cost savings you think you can squeeze out of the business model over the next few years. I'm sure within the mix, and you've highlighted some of them, there's going to be areas to invest in. I'm wondering how you think about OVHcloud as a brand and whether you think you need to elevate that in your ex-France markets over the midterm to have a kind of stronger market position. And then the second question on the financial side. When we think about the margin improvement in FY25, could you split that up between how much of that maybe 160 bps comes from the electricity side versus operating leverage? Thank you.