Colt Group S.A. (London Stock Exchange: COLT) issued today the results for the six months ended 30 June 2014.
Highlights of first half of 2014:
- 2014 full year EBITDA guidance remains as previously advised in April 2014. The restructuring programme outlined in April has commenced and remains on track to deliver targeted savings in 2014 and beyond
- Overall Group revenue declined by 2.3% (3.3% constant currency) due mainly to a contraction in the Voice business from regulatory price declines and the exit from low margin reseller customers
- Group EBITDA of €145.4m (18.9% margin) (H1 2013: €158.0m) represented a year on year decline of €12.6m (8.0%). This decline was driven primarily by a reduction in direct gross margin (€16.0m excluding depreciation) partially offset by reductions in selling general and administrative expenses of €3.4m
- Net cash outflow improved from €59.0m in H1 2013 to €29.1m in H1 2014 due to improved working capital and reductions in capital expenditure
- As reported previously, Colt established four lines of business in H1 2014: Network Services, Voice Services, Data Centre Services and IT Services, and we initiate reporting under these new segments with H1 2014 results
Key information:
| Six months to 30 June | ||||
| € millions | 2014 | 2013 | Nominal Movement | Constant Currency Movement |
| Unaudited | Unaudited | |||
| Total revenue | 770.4 | 788.9 | (2.3%) | (3.3%) |
| Network Services | 414.7 | 414.5 | 0.0% | (0.9%) |
| Voice Services | 259.9 | 276.7 | (6.1%) | (7.0%) |
| Data Centre Services | 59.6 | 58.8 | 1.4% | (0.4%) |
| IT Services | 36.2 | 38.9 | (6.9%) | (7.6%) |
| EBITDA1 | 145.4 | 158.0 | (8.0%) | (10.2%) |
| Profit before tax2 | 13.6 | 16.7 | (18.6%) | (27.7%) |
| Free cash outflow3 | (29.1) | (59.0) | (50.7%) | N/A |
| Capital expenditure | 137.5 | 146.5 | (6.1%) | N/A |
| Net funds4 | 167.1 | 219.7 | (23.9%) | N/A |
1 EBITDA reflects profit before net finance costs and related foreign exchange, tax, depreciation, amortisation and exceptional items 2 Profit before tax is stated before exceptional items 3 Free cash flow is net cash generated from operating activities less net cash used to purchase non-current assets and net finance costs paid 4 Net funds reflects cash and cash equivalents plus deposits classified as current asset investments
Rakesh Bhasin, Chief Executive Officer, commented:
“The first half results continue to reflect the current economic climate and negative regulatory pressures evident across large elements of our European markets. In the second quarter we commenced the withdrawal from low-margin carrier voice trading business and re-organised the business into the four elements of our information delivery platform: Network, Voice, Data Centre and IT. We believe this will enable the Company to better realise growth opportunities, improve profitability and increase return on investment. Our restructuring programme should start to show results in the latter part of this year. We have already started the process of implementing improvements to our business and I remain convinced by the opportunities available to us.” To read the full press release click here FORWARD LOOKING STATEMENTS
This report contains ‘forward looking statements’ including statements concerning plans, future events or performance and underlying assumptions and other statements which are other than statements of historical fact. Colt Group S.A., ‘the Group’, wishes to caution readers that any such forward looking statements are not guarantees of future performance and certain important factors could in the future affect the Group’s actual results and could cause the Group’s actual results for future periods to differ materially from those expressed in any forward looking statement made by or on behalf of the Group. These include, among others, the following: (i) any adverse change in regulations and technology within the IT services and communications industries, (ii) the Group’s ability to manage its growth, (iii) the nature of the competition that the Group will encounter and wider economic conditions including economic downturns, (iv) unforeseen operational or technical problems and (v) the Group’s ability to raise capital. The Group undertakes no obligation to release publicly the results of any revision to these forward looking statements that may be made to reflect errors or circumstances that occur after the date hereof.
Enquiries:
Investor Relations: Morten Singleton DDI: +44 (0) 20 7863 5314 Mobile: +44 7535 445159 Email: morten.singleton@colt.net Press: Helen Toft DDI: +44 20 7039 2420 Mobile: +44 7855 301078 Email: helen.toft@colt.net
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