Cordiant Digital Infrastructure Ltd (LSE:CORD) joint managing Directors Steven Marshall and Benn Mikula, alongside CFO Mark Tiner, talked with Proactive about the company's exceptional results for the first half of the financial year.
Marshall highlighted a 5.4% growth in NAV, reaching 124.4 pence, and announced an interim dividend of 2.1 pence, covered 4.7 times by EBITDA. He attributed this growth to strong performances from their three primary operating companies—České Radiokomunikace, Emitel, and Speed Fibre Group.
Proactive: Steve, I’ll start with you. How would you summarise the results?
Steven Marshall: The first six months of this financial year delivered extraordinary results. We grew the NAV by 5.4%, increasing it to 124.4 pence. This morning, we also confirmed an interim dividend of 2.1 pence, which is 4.7 times covered by EBITDA or 1.8 times by AFFO.
This strong performance is due to quality growth in revenues and EBITDA across our three primary operating companies: CRA (České Radiokomunikace), Emitel, and Speed Fibre Group, with improving trends in our HIX (Hudson Interxchange) data centre in New York.
Proactive: Mark, could you explain the drivers of this performance?
Mark Tiner: Certainly. The results were driven by robust EBITDA growth across the portfolio, which increased by 15.2% in six months.
At Emitel, we achieved EBITDA growth of 15.7%, supported by two new broadcasting contracts signed earlier this year and inflationary adjustments from last year. CRA saw EBITDA growth of 16.5%, benefiting from inflationary adjustments and the strong performance of Cloud4com, a cloud business we acquired in January 2024. Speed Fibre Group also posted a solid EBITDA growth of 7.2%.
Proactive: Ben, what do you think underpins Cordiant’s performance this time and since its listing?
Benn Mikula: There are three elements: people, strategic clarity, and experience with delivery.
Firstly, our team of nearly 20 digital professionals brings a balance of deep operational experience and private capital expertise, creating a harmonious dynamic.
Secondly, we have strategic clarity, employing a buy, build, and grow model that continues to deliver quarter after quarter.
Finally, our execution and experience allow us to enhance businesses through acquisitions, operational discipline, and importing best practices.
Proactive: Steve, can you explain your capital allocation strategy, especially concerning dividends, growth investments, and share buybacks?
Steven Marshall: We’ve been very careful with capital allocation since the start, balancing growth assets with shareholder returns. Our early acquisitions in Poland, the Czech Republic, and Ireland have been exceptional.
We’ve also conducted some share buybacks while ensuring a progressive dividend policy. This year’s dividend exceeds IPO projections, and we expect this policy to continue alongside investments in growth opportunities.
Benn Mikula: As Steve mentioned, a strong balance sheet is crucial. Good assets with poor financial discipline can lead to challenges.
Proactive: Finally, Ben, what gives you confidence about the year ahead?
Benn Mikula: Two key factors: market trends and operational strength. Digitalization and artificial intelligence are driving demand for infrastructure like ours, which is essential to internet functionality.
Additionally, our platforms are operating at a high level. These quality assets, managed by excellent teams, are delivering strong results, and we’re confident they’ll continue to do so.
Steven Marshall: Long-term contracts, growth investments, and increasing demand for infrastructure like mobile towers and data centres position us well for sustainable revenue and EBITDA growth.
Proactive: Congratulations again on your results, and thank you for coming into the studio.