UPDATE 1-Telecoms firm Iliad to step up spending on 5G

(Adds detail from call)

May 18 (Reuters) – Telecoms group Iliad reported like-for-like revenue growth of almost 5% in the first quarter, helped by a rise in mobile and broadband subscribers, and announced plans to step up spending on 5G networks.

In its main French market, Iliad – which competes with Orange, Bouygues Telecom and Altice’s SFR – said its Free Mobile Unlimited 4G/5G Plan had added 94,000 net subscribers during the first three months of the year, while it also won new customers in Italy and Poland.

“These commercial results can be explained by the strong dynamic of our network rollouts, which we will continue to accelerate,” Chief Executive Thomas Reynaud told reporters in a call on Tuesday.

Iliad, controlled by billionaire Xavier Niel, said it would review its 2021 cash flow target for France in order to speed up spending on 5G networks in the country, where it launched the cheapest offer of the four main operators late last year.

To help ramp up spending, the Paris-based group said it would sell its 30% stake in On Tower France, which it values at a minimum of 600 million euros ($731 million).

Iliad, which had previously guided for a French operating free cash flow of around 900 million euros this year, said it would give a new target in September, also taking into account a global shortage in semiconductor components.

The company said it expected to turn a profit from its Italian business this quarter – sooner than previously forecast – but delayed the launch of its broadband offer there until after the summer due to the pandemic.

In Poland, it said its integration of mobile operator Play – bought late last year – was proceeding ahead of schedule, with 8,000 new customers added over the first three months of 2021.

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