Community Fibre posts their maiden profit...

As per article yesterday in the FT here (no paywall) and subsequently re-reported over at ISPR News too.

All the meanwhile TalkTalk struggles and other Altnets lay off more staff and others like Netomnia and Brsk complete their mergers.

Are we seeing the early beginnings of consolidation and a show of the strong and the weak, as a precursor thereof?

Should have also added....

G.Network have been actively canvassing buyers the last few months. So far no one interested.

Nexfibre are slowing their network build and have also paused their wholesale NetCo plans, due to "retaining capital discipline in an increasingly irrational altnet environment and remaining opportunistic around M&A"

Mmmm pass the popcorn 🍿

G.Network are so poorly run, nothing could surprise me with them.

The only value the company has is to someone like CityFibre because they deployed a network in central London by doing a ton of civils and they own their own duct network as a result. A network serving 416k premises with takeup estimated at 5% isn't worth £450m, though.

G.Network should be renamed D.Network. It would more accurately reflect their core asset which is a nice new green duct network with precious few actual paying customers. Last accounts gross revenue was just over £10M which although they didn’t declare connected customers since 2022, puts them in the ballpark of 20,000 to 25,000 paying customers. Which is a bit hopeless given their outlays. Mismanaged as you say. Badly so.

CF has been ruthless in offering a very cheap product and also doing deals with councils so it has got access to high-density social housing.


I'm not sure if they are still building though,

(I am a happy CF customer)

In reply to a post by Pheasant:

Nexfibre are slowing their network build and have also paused their wholesale NetCo plans, due to "retaining capital discipline in an increasingly irrational altnet environment and remaining opportunistic around M&A"
Mmmm pass the popcorn 🍿

I always thought the NetCo 1H2025 ambition was rather quick, especially as 1H2025 is nearly over!

Got any popcorn to share, this is going to run...

Some companies, when they talk about H1 or Q1, are talking about their company accounting year, not the calendar year.

Around 6-8 months ago, they were prepared to build out to me (not huge maybe hundred metres or so pull from where their spine passes) in central London for a 2-3 year business contract. Otherwise there was no hope for a ‘regular’ resi type connection. Covered now by Openreach FTTP (since end Dec) and also active Hyperoptic service.

In reply to a post by candlerb:

Some companies, when they talk about H1 or Q1, are talking about their company accounting year, not the calendar year.

Of course, and Apple are famous as having Q1 starting at end of calendar year covering the Christmas peak sales period!

Yes stocking up the 🍿 machine!

As many of these companies are now coming to maturing loan obligations / refinance their debt / loans; easy, cheap money is increasingly harder to shake out of the magic money tree (aka private finance) as lenders (a) far more clued up / have less risk appetite then they did 4 or 5 years ago (b) it’s become increasingly apparent who has done a good job and who hasn’t…

Take profit with a pinch of salt ...

earnings before interest, tax, depreciation and amortisation of £8mn in 2024.

Sound good until you read: "However, Community Fibre still reported a pre-tax loss of £118.5mn last year off the back of substantial investments in its network. "

So to cover the other costs including interest payments they will need to multiply that by 15. Could they increase customer base 5, 10, 15 times with no further investment and thus additional capital and interest?

Absolutely. There’s no way they can be profitable after network investment costs are taken into consideration.

It’s exactly the same for the like and scale of BT Group with Openreach, except their FTTP investment numbers are 10x of CF and they have other business to offset that inherent “loss”.

I see the same thing in other large capex projects like national grid upgrades (just reading about the £60B investment NESO estimates will be required by 2030, the huge investments in EV ultra fast charging networks across the country and many, many more examples.

Not sure we can compare Community Fibre results last year of £118Million loss on earnings of £8Million with BT's results of a profit of £427Million on earnings of £2100Million in the last 3 months to Dec

Community Fibre are probably doing better due to their large coverage in London. Almost everywhere in Central London there is either Community Fibre or Hyperoptic.

In my building alone out of the 81 flats, 40 flats have already taken Community Fibre, which I am not all that surprised. I searched them one by one out of curiosity. The reason for this is because Openreach FTTP coverage is quite low in London and people are naturally opting for Community Fibre as there is little choice.

But I think their profits may have been even higher if they didn't have these restrictions such as CGNAT or routers with only 3 LAN ports. I've not yet taken Community Fibre for this reason, whether it is a silly reason to delay it but at the moment I am testing a few games where port forwarding is required and then to see if this will have problems when I switch. At least I can see the ports are opened with BT FTTC.

Despite this barrier I think the 5Gbps is a big selling point, which does grab attention of customers. Even though most are not selecting the 3/5Gbps package it gives confidence to customers that they'll get decent speeds.

I believe G.Network is definitely going to be consolidated as not only their prices are more expensive but their lower tier packages are not symmetric. They have very low coverage G.Network Premises Jan 2024 (Jul 2023) – TBB Analysis: 248,000 (255,000) vs CommunityFibre 1.3m (1.1m).

That's a massive difference. I also noticed G.Network 2.4 stars out of 5 from 382 Google reviews vs Community Fibre
4.3 out of 5 stars from 6,594 Google reviews. The negative reviews of G.Network are making them lose potential customers and may also make them lose confidence to landowners who won't want to agree a wayleave for their buildings.

TalkTalk are losing customers as they are no longer budget and are price hiking mid-contract! Their customer service is pretty bad and their service has not been reliable for me in the 2 years that I've been with them. Originally when I signed up with them in 2020 they were £21.75 a month and then after a few months it became £23 and then it jumped to £39.99 a month at the end of the contract. Their regular maintenance often coincided with their network outage where router would show as connected but pages won't load. This occurred randomly every few weeks and lasted around 10 minutes before naturally returning to normal. Never have had such problems like this since switching to BT.

But of-course overall across the country BT and Openreach are much stronger than any of the Altnets. They'll have naturally higher profits due to customers from ADSL, FTTC and FTTP.

Btw, you can read all the FT paywall articles including the premium articles by simply searching the news headlines via search engine and they'll open in FT for a few times and after that you can clear cookies for FT website by clicking on the padlock icon and clear cookies and like that you can read FT for free.

Yes, they're making a loss in net terms, but you're assuming they'll be adding to do their debt pile by requiring more capital - that's where you're wrong.

What EBITDA positive means is their 'E' Earnings are sufficient to be reducing their debt pile, not adding to it, so the 'I' Interest is manageable. They also have 0 'T' Tax as they're making a net loss so it's redundant as corporation tax is only on profits (for this reason, companies have little incentive to turn an actual profit). The equipment is still pretty fresh so there's only a little 'D' Depreciation (although irrelevant as in the UK we can't write off depreciation against tax like in the US), but it will in turn be covered by 'A' Amortization as they will (hopefully) have budgeted that XGS-PON will need to be upgraded to newer faster PON technologies etc.

So yes, EBITDA positive means they are OK and their debt is reducing not increasing and the news is they now have a sustainable mortgage and not burning lenders' cash like torchpaper.

Where I live in NW9 most of the local roads are covered. Where a road has cable is wholly underground, CF have bypassed that road. My road is a mixture of pole (my end of the road) and underground - about 10 houses.


Good thing OR has just overbuilt - subject to the checker issue on the other thread.

Don't understand. AFIAK only the 1gig and below plans have CGNAT. So you can just get 2.5gbit/sec for £39/month which is only £7/month more than the 1gig plan and still extremely well priced? Apparently you can add a public IPv4 for £5/month.

95%+ of users do not care about CGNAT and giving everyone a routable IPv4 would be extremely expensive - probably on the order of £1/month (probably a bit less now but the price is going up all the time). There is no way that they'd get enough extra customers with that to offset the cost of it.

Don't understand the LAN ports part either; I suspect 90% of users only use WiFi and you could just add a £30 2.5gigE switch to get more ports if you need them?

In reply to a post by zzing123:

Yes, they're making a loss in net terms, but you're assuming they'll be adding to do their debt pile by requiring more capital - that's where you're wrong.

What EBITDA positive means is their 'E' Earnings are sufficient to be reducing their debt pile, not adding to it, so the 'I' Interest is manageable. They also have 0 'T' Tax as they're making a net loss so it's redundant as corporation tax is only on profits (for this reason, companies have little incentive to turn an actual profit). The equipment is still pretty fresh so there's only a little 'D' Depreciation (although irrelevant as in the UK we can't write off depreciation against tax like in the US), but it will in turn be covered by 'A' Amortization as they will (hopefully) have budgeted that XGS-PON will need to be upgraded to newer faster PON technologies etc.

So yes, EBITDA positive means they are OK and their debt is reducing not increasing and the news is they now have a sustainable mortgage and not burning lenders' cash like torchpaper.

Cheers for taking the time to explain a bit about EBITDA and Accounting 101 here. 😅

In reply to a post by FibreBubble:

Not sure we can compare Community Fibre results last year of £118Million loss on earnings of £8Million with BT's results of a profit of £427Million on earnings of £2100Million in the last 3 months to Dec

The point as noted above is that this enormous network investment will not return a net profit for many a year. That’s whether you’re BT Group or one of the minnows. Just that BT have many other lines of business that can support the other areas of the group that would otherwise be in serious deficit.

In reply to a post by zzing123:

Yes, they're making a loss in net terms, but you're assuming they'll be adding to do their debt pile by requiring more capital - that's where you're wrong.

What EBITDA positive means is their 'E' Earnings are sufficient to be reducing their debt pile, not adding to it, so the 'I' Interest is manageable. They also have 0 'T' Tax as they're making a net loss so it's redundant as corporation tax is only on profits (for this reason, companies have little incentive to turn an actual profit). The equipment is still pretty fresh so there's only a little 'D' Depreciation (although irrelevant as in the UK we can't write off depreciation against tax like in the US), but it will in turn be covered by 'A' Amortization as they will (hopefully) have budgeted that XGS-PON will need to be upgraded to newer faster PON technologies etc.

So yes, EBITDA positive means they are OK and their debt is reducing not increasing and the news is they now have a sustainable mortgage and not burning lenders' cash like torchpaper.

Can I question the note about depreciation? It will depend on the accounting policy adopted by the company. There may be a straight line policy so that the depreciation will account at the same financial amount each year until the asset has been fully paid off and shows at zero value. Alternatively there is a policy based on the asset value and expected life where there is higher depreciation in the early part of the life of the asset. People can relate to that policy at a domestic level if they buy a new car and watch how the value takes a huge dive in the first year then the value of the car falls by a lesser figure in each following year. I'm struggling to see a scenario where the kit is new so the depreciation is low.

In reply to a post by BLaZiNgSPEED:

Btw, you can read all the FT paywall articles including the premium articles by simply searching the news headlines via search engine and they'll open in FT for a few times and after that you can clear cookies for FT website by clicking on the padlock icon and clear cookies and like that you can read FT for free.

You can also use your Library Card in Press Reader to get free access to many online newspapers and magazines.

I'm not sure how you can draw the conclusion that the company debts and interest payments are all under control. The EBITDA to debt ratio could equally be concluded to be ruinous.

In reply to a post by zzing123:

What EBITDA positive means is their 'E' Earnings are sufficient to be reducing their debt pile, not adding to it, so the 'I' Interest is manageable.

EBITDA of £8m in 2024 means they can afford to pay £8m towards 2024's interest. The interest was £44.8m in 2023 and will be higher in 2024 when the accounts are published. The majority of interest accruing on their debt is still being added to the debt. The debt pile is not reducing!

They can't keep increasing their total debt faster than inflation forever. At some point they must generate enough revenue to cover operating costs and most if not all of the interest accruing each year. They are closer to achieving that than many altnets but they still need a substantial increase in revenue.

As Community Fibre are claiming they have better take up than their altnet peers, it's a challenge to see where the increase in revenue to reduce their shocking EBITDA to debt ratio is going to come from.

Their Box Broadband subsidiary split town in a hurry around here, abandoning plant badly taped to poles all over the place. They won't be getting any revenue from that.

In reply to a post by CJ8:

EBITDA of £8m in 2024 means they can afford to pay £8m towards 2024's interest. The interest was £44.8m in 2023 and will be higher in 2024 when the accounts are published. The majority of interest accruing on their debt is still being added to the debt. The debt pile is not reducing!

Apologies, I should've been clearer. Yes debt is still increasing, but not at the unsustainable rate it was before. Getting more sustainable being the operative term.

The game plan for all these companies isn't to (ever) pay back all the debt, but instead to either find a new buyer who then pays back existing lenders and the company still has to pay interest to the new lender, hopefully on better terms. Or they float on the stock market in which debt is replaced by equity and the capital raised from shareholders goes to pay back the previous lenders, but in turn they have to pay dividends, maintain a nice share price and deal with about 1000x more regulation.

BT can only just about do this - but they too have their ups and downs and are certainly in no position to easily be able to buy back all their shares.

Depreciation in business assets works differently to cars because car value is based on how much someone else is willing to pay for it. Same as art - it's only as valuable as someone is willing to pay for it. Most people plan to sell their car or part-ex for a new one.

What a business needs to do is account for their Net Asset Value (how much the company could raise if it theoretically sold everything it had). For this reason they simply account for the depreciation of their assets such as routers and servers. While equipment can be sold on ebay afterwards, this is just a bonus for the company, not usually planned revenue. It's also a good indicator for accountants, management and lenders to know when to make a business decision of when something needs to be sweated (still used after it's depreciated to zero) or when to spend (eg a company may want to splash out to reduce or round down profits just before they submit their tax return).

Hope that makes sense?

In reply to a post by mr_mojo:

Don't understand. AFIAK only the 1gig and below plans have CGNAT. So you can just get 2.5gbit/sec for £39/month which is only £7/month more than the 1gig plan and still extremely well priced? Apparently you can add a public IPv4 for £5/month.

95%+ of users do not care about CGNAT and giving everyone a routable IPv4 would be extremely expensive - probably on the order of £1/month (probably a bit less now but the price is going up all the time). There is no way that they'd get enough extra customers with that to offset the cost of it.

Don't understand the LAN ports part either; I suspect 90% of users only use WiFi and you could just add a £30 2.5gigE switch to get more ports if you need them?

Yes, until recently it was like that and you needed 3Gbps. Now after the 5Gbps package they made it so that only 2.5Gbps and 5Gbps have CGNAT removed.

Just over 2 years ago CGNAT was something that was removed for 500Mbps package and people were complaining that you needed minimum 500Mbps and then Community Fibre changed their policy and made it for 3Gbps.

Now they are saying it is for Premium 2.5Gbps and 5Gbps. You say it is only £7 more. But the truth is that the 1Gbps package is £25. Premium is for extra WiFi Whole Home coverage. I could buy WiFi extenders manually. To pay £32 for 1Gbps Premium for this makes no sense.

So, that means in truth we have to pay £14 more per month for the 2.5Gbps. Most of us users don't need more than 1Gbps. Heck, even people on these forums are saying 100Mbps is enough.

I can't imagine that 95%+ of users won't require port forwarding! Just so you know in both Xbox Live and Games for Windows Live if your ports are blocked, you can't join the online servers or host games!

There was a time in 2007 and 2008 with Pro Evolution Soccer 6 and 2008 when I did not open the relevant ports after a match up with my online opponent it would disconnect me a few seconds later. Game was being aborted and it was like that with every opponent regardless of region as it was peer-to-peer network. Then I discovered that I needed to open some ports and then straightaway this issue was resolved.

I had the same problem with Shadowrun, Gears of War and Halo 2 Games for Windows Live. I'm looking to install Shadowrun again as I know GFWL servers are still running and this game supports multiplayer cross platform Xbox 360 vs PC. If CGNAT breaks port forwarding I'll have to say goodbye to these online games. GFWL is still surprisingly quite active and Microsoft recently fixed their servers after a temporary outage.

As for the LAN ports, 3 ports are just about enough for us. But I needed a 4th port because in my case when I had a Technomate TM-5402 Satellite receiver (due to it being an old model) it did not support WiFi. I upgraded to an Octagon 4K receiver and now have WiFi built in so now I'm not dependent on the extra port. But it is still handy. BT, TalkTalk, Sky, etc all have 4 LAN ports. That's one major demerit to being stuck with a single Altnet.

However, I'm aware that Community Fibre 5Gbps Technicolor FGA5330 has 4 LAN ports. But only 1 of them has 10Gbps support and the rest of the 3 have 1Gbps. These are some restrictions that we customers have to face and sadly they are currently my only Altnet. Virgin Media Nexfibre is my only next hope after a wayleave agreement.

This may explain why Community Fibre are having decent profits. If Openreach FTTP/VMO2 Nexfibre achieve massive rollout in London they will steal away a portion of the Community Fibre customers and the Altnets will be at risk of consolidation.

I very much doubt the number of LAN ports on routers has any sort of bearing on profitability of an enterprise.

Altnet consolidation is inevitable. It’s already happening. The question is who will be eating who and what entities will be left from the 100 odd we have today.

In reply to a post by Pheasant:

I very much doubt the number of LAN ports on routers has any sort of bearing on profitability of an enterprise.

Agree. It's highly unlikely. I think it's more to do with the fact their preferred supplier (Linksys) doesn't have a 10gbps router and so they have to use Technicolor. The issue is also basic availability - does anyone know of any router with 2x 10gbps ports costing about £70 or so that an ISP could amortise on a consumer connection? I don't.

In reply to a post by Pheasant:

Altnet consolidation is inevitable. It’s already happening. The question is who will be eating who and what entities will be left from the 100 odd we have today.

Hopefully, as soon as the wooden spoons running this economy get a clue and interest rates settle down a bit to provide businesses with a bit more stability, we might see some bigger announcements. For now, it's only small acquisitions as CityFibre have done with the likes of Lit and Connexin etc. But already, the likes of Virgin are feeling the pinch and have to have sane prices again.

In reply to a post by Pheasant:

I very much doubt the number of LAN ports on routers has any sort of bearing on profitability of an enterprise.

Altnet consolidation is inevitable. It’s already happening. The question is who will be eating who and what entities will be left from the 100 odd we have today.

Depends, maybe this may have no bearing in the case of an Altnet as naturally people who will upgrade to FTTP may sacrifice & resort to using a gigabit switch or upgrade to their own third party router.

But in the case of certain ISPs on the Openreach network like Now Broadband, which until not long ago supplied only 2 LAN ports and this was a turn off. Just over 5 years ago I found a cheap deal for only £19 a month. But the Now Broadband router having only 2 ports did discourage me and many other reviewers mentioned this as one of the cons.

NOW Hub Two router was the one with 2 ports. NOW no longer offer the old Hub Two and now get a Sky Broadband Hub router instead, which is a much better router with 4 ports. At that time I opted for Plusnet that had 4 ports.

If there is a choice of multiple ISPs on a network and one router supplied has 4 ports and the other had 2-3, you'll probably opt for the ISP with more ports unless that ISP had overall more pros than cons.

The CGNAT issue is certainly a far worse problem and that will certainly have an influence on some customers partaking the service. Some customers are either sacrificing it, cancelling the service and remaining on FTTC or trying to mitigate it with some sort of VPN/Tailscale method to overcome the port forwarding issues. Community Fibre don't make this explicitly clear in their main site and packages and some customers are unaware of this problem.

But because this is FTTP that's why they are attracting customers even with CGNAT, but that doesn't mean we are all 100% happy with such a service.

Of-course I will be happy to go from 80Mbps to 1Gbps but I won't be happy if my ports are blocked and it causes issues for my applications/online games. For others who only do basic web browsing they might not mind this.

The Altnet consolidation will happen and I believe one day we won't be stuck with single Altnet ISPs only.

I think Community Fibre will either be sold or merged together with another network provider at some stage even with all their positive profits. Maybe multiple Altnets might join up together as wholesale, who knows. Only the big fishes will survive in 5-10 years time. The same with Virgin Media, for many years they were independent but perhaps due to lack of competition their monopoly may have worked in their favour. People would choose VM DOCSIS over ADSL/FTTC. But now with FTTP and XGS-PON and fierce competition Nexfibre and VMO2 has to become wholesale or they will lose customers because the same old monopoly will no longer work.

Less than £20 for a 5 port Giga Switch seems like a small cost to get over the issue.