KPN, the Dutch telecom giant, has announced a new strategic direction dubbed “Connect, Activate & Grow,” in which the company will invest nearly €5 billion over the next three years.
This new strategic framework will take the place of the company’s previous “Accelerate to Grow” strategy, which was unveiled at the end of 2020. KPN CEO Joost Farwerck explained that the original strategy’s goals had been met in large part, returning the company to sustainable growth and preparing it for the next steps.
“We have delivered on the main ambitions of our Accelerate to Grow strategy launched end-2020. Our top line has returned to sustainable growth across all segments and the fibre roll out has progressed according to plan, further accelerated by our JV Glaspoort. I am proud of our people and grateful for their commitment to realize these ambitions. In the coming years, we will finish what we started and realize a fiber footprint of about 80% of the Netherlands by end-2026,” said Farwerck.
The new strategy for the company will center on creating a “sustainable future” and “long-term value” for all stakeholders. This includes expanding the company’s ESG ambitions, as well as maintaining “healthy” service revenue growth.
KPN is aiming for a 3% compound annual growth rate (CAGR) for both service revenue and adjusted EBITDA after leases over the 2024–2027 period and a free cash flow CAGR of 7%.
In addition to these expansion and investment objectives, shareholders will be happy to learn that during the same time frame, they will receive €3.8 billion in payments, including €1 billion via share buybacks. With plans to repurchase shares valued at €200 million in 2024, the company plans to start this buyback process early the following year.
“Our focus on creating value enables us to continue delivering attractive shareholder returns and we remain committed to our policy of returning all our Free Cash Flow to our shareholders. Effectively this means that we will distribute € 3.8bn to our shareholders over the next four years, with a higher portion of that coming from dividends,” according to Farwerck.
