Telio Holding ASA. 1st QUARTER REPORT 2012

Transcription

1 Telio Holding ASA 1st QUARTER REPORT 2012

2 Telio Holding ASA 1 st Quarter Report 2012 Summary Q is the first quarterly reporting after the company introduced broadband services and enhanced mobile services from the beginning of the year. The first quarter already reflects these initiatives showing increased customer intake with 6,088 net new customers *) compared to 3,938 in the previous quarter. Market development The Telio Group showed improved customer growth in the 1 st quarter. Total net customer intake was 6,088. Norway had a net decline of 1,209 VoIP customers, offset by 1,202 new mobile customers (residential and business) and 1,493 residential broadband lines. The Swiss operation added 642 net new customers in the quarter while Denmark had a net increase of 33 customers. The Dutch operation through its white label agreements showed increased customer intake adding 4,039 new customers. Introduced new services Telio introduced fixed and mobile broadband services at the end of the fourth quarter With these new services in addition to a new MVNO agreement, Telio provides a complete and competitive service offering to both the residential and the business segment. The offering now comprises broadband telephony, fixed broadband, mobile, mobile broadband and web based switchboard. The number of broadband lines was 1,493 at the end of the first quarter. Key figures (Figures in NOK million) Q Revenues 98.5 Gross profit 63.1 Gross margin 64.1% EBITDA 28.1 EBIT 18.2 *) Customers defined as product sales, not unique customers Financials Q (2011 figures in brackets) Revenues in Q1 were NOK 98.5 million (98.1). Gross profit was NOK 63.1 million 64.1% gross margin ( %). EBITDA was NOK 28.1 million 28.5 % ( %). Operating profit was NOK 18.2 million (23.0). Profit after tax was NOK 12.7 million (19.2). The increase in operating expenses compared to the same quarter last year is in line with the company s growth strategy. The cost increase is primarily related to increased sales and support staffing and customer acquisition. A majority of the costs are variable and directly linked to actual sales. Cash flow from operations was NOK million in Q after payment of NOK 50 million in VAT for previous years (accrued as of 31 December 2011). Cash and cash equivalents were NOK 59.6 million at 31 March. Investments Investments in Q were NOK 10.8 million, including leased equipment (see notes 6 and 7 for details). Related party transactions There have been no transactions by related parties that have had a material effect on the Group s financial position or results in the period. Shareholder information The total number of registered shares outstanding at the end of Q was 19,392,700 (19,392,700 at the end of Q4 2011) out of which 375,001 shares were owned by Telio Holding ASA (375,001 shares at the end of Q4 2011). The total number of shareholders was 532 (549 at the end of Q4 2011) and 29.3% of the shares were registered abroad (30.7% at the end of Q4 2011).

3 Total outstanding options at the end of Q was 638,900 (638,900 at the end of Q4 2011) with an average strike price of NOK (NOK at the end Q4 2011). The stock price moved from NOK to NOK (+8%) during Q1. Future market developments The board expects no significant short term changes in the markets and business environment in which Telio operates. Dividend On 20 March 2012 the board approved the annual accounts for 2011 and proposed a dividend payment of NOK This was approved by the annual general meeting on 12 April To accommodate the company's cash situation the dividend will be paid in two parts, the first part at NOK 1.50 will be paid on 27 April 2012 and the second part at NOK 1.00 on 20 September Oslo, 25 April 2012 Board of Directors Telio Holding ASA Liv Bergtorsdottir Erik Osmundsen Aril Resen (sign.) Chairman of the Board (sign.) (sign.) Arnhild Schia Haakon Dyrnes Eirik Lunde (sign.) (sign.) CEO (sign.)

4 Condensed consolidated interim balance sheet (unaudited) (Figures in NOK 1000) Note ASSETS Non-current assets Property, plant and equipment Intangible assets Deferred tax assets Current assets Inventory Trade and other receivables Cash and cash equivalents Total assets EQUITY Share capital Other reserves Retained earnings Total equity LIABILITIES Non-current liabilities Borrowings Current liabilities Trade and other payables Current income tax liabilities Borrowings Deferred income Accrued liabilities Total liabilities Total equity and liabilities Oslo, 25 April 2012 Board of Directors Telio Holding ASA Liv Bergtorsdottir Erik Osmundsen Aril Resen (sign.) Chairman of the Board (sign.) (sign.) Arnhild Schia Haakon Dyrnes Eirik Lunde (sign.) (sign.) CEO

5 Condensed consolidated interim income statement (unaudited) (Figures in NOK 1000) Note Q Q Sales Other revenues Total revenues Cost of connection and traffic charges Salaries and personnel costs Selling and marketing costs Other costs Depreciation and amortization 6, VAT expense for previous years Operating profit Finance Profit before income tax Income tax Profit Attributable to: Equity holders of the parent company Other comprehensive income Q Q Translation differences Other income and expenses during the period (after tax) Comprehensive profit for the period Profit attributable to: Equity holders of the parent company Earnings per share Earnings per share Diluted earnings per share

6 Condensed consolidated interim statement of changes in equity (unaudited) (Figures in NOK 1000) Share capital Treasury shares Share premium reserve Other paid-in equity Translation differences Retained earnings Total equity Equity as at 1 January Comprehensive profit/loss for the period Profit/Loss Other income and expenses Translation differences Total other revenues and expenses Comprehensive profit/loss for the period Transactions with owners, recorded directly against equity Receipts from and distributions to owners Purchase of treasury shares Dividends to owners Share-based payment transactions Share options exercised Total receipts from and distributions to owners Equity as at 31 December Equity as at 1 January Comprehensive profit/loss for the period Profit/Loss Other income and expenses Translation differences Total other revenues and expenses Comprehensive profit/loss for the period Transactions with owners, recorded directly against equity Receipts from and distributions to owners Purchase of treasury shares Dividends to owners Share-based payment transactions Share options exercised Total receipts from and distributions to owners Equity as at 31 March

7 Condensed consolidated interim statement of cash flows (unaudited) (Figures in NOK 1000) Cash flows from operations Q Q Profit/loss for the year before tax Adjustment for: - Net financial items Interest paid Interest received Realized foreign exchange gain/loss Taxes paid Depreciation Amortisation Non-cash transactions related to option costs Changes in inventory Changes in trade accounts payable and other liabilities Changes in trade accounts and other receivables Change in deferred revenue Net cash flow from operations Cash flows from investment activities Purchase of property, plant and equipment (tangible fixed assets) Acquisition of PPE through financial lease Purchase of other investments (intangible assets) *) Net cash flows used in investment activities Cash flows from financing activities (Purchase)/sale of treasury shares Proceeds for shares issued to employees New leasing debt Payment of liabilities related to financial leasing Dividends paid Net cash flows used in financing activities Change in cash and cash equivalents Cash and cash equivalents and credit facilities utilised as at beginning of period Effect of exchange rate fluctuations on cash and cash equivalents Cash and cash equivalents as at end of period *) Includes capitalised expenses related to the development of a proprietary technical platform and capitalised customer acquisition costs

8 Telio Holding ASA Notes to the condensed consolidated interim financial statements (unaudited) Note 1: Reporting entity Telio Holding ASA (the Company ) is a company domiciled in Oslo, Norway. These March 2012 condensed consolidated interim financial statements of Telio Holding ASA and its subsidiaries (together the Group ) are for the three months ended 31 March The consolidated financial statements of the Group as at and for the year ended 31 December 2011 are available upon request from the Company s registered office at Harbitzalleen 2A, Oslo, or at Note 2: Statement of compliance These condensed consolidated interim financial statements of Telio Holding ASA Group have been prepared in accordance with rules and regulations from Oslo Stock Exchange and International Financial Reporting Standard (IFRS) IAS 34, Interim Financial Reporting. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group as at and for the year ended 31 December These condensed consolidated interim financial statements were approved by the Board of Directors on 25 April Note 3: Significant accounting policies These condensed consolidated interim financial statements have been prepared under the historical cost convention. They have been prepared under the same accounting principles as those set out in the consolidated financial statements of the Group as at and for the year ended 31 December Note 4: Estimates The preparation of interim financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these condensed consolidated interim financial statements, the significant judgments made by management in applying the Group s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the year ended 31 December 2011.

9 Note 5: Segment information IFRS 8 requires segment reporting for operative segments. Telio is a niche company that specialises in the development, marketing and sales of IP-based services and communication solutions, and it operates only in this one business segment. The following geographic segments have been defined based on where the customer is domiciled: Norway, Denmark, the Netherlands and Switzerland. The risk and return are influenced by the geographic location of the operations, in addition to the market. Telio's definition of the geographic segment is based on the location and customer segment in these markets. Transactions between the segments are eliminated. The company's highest decision-making body is the company's Board of Directors and management. (Figures in NOK 1000) Q Profit and loss by segment Norway Denmark Netherlands Switzerland Others 1) Group Total revenues Intra-group revenues Net revenues Total costs of sales Intra-group cost of sales Net cost of sales Gross profit/loss Gross margin 68 % 63 % 44 % 50 % 0 % 64 % Total operating expenses Intra-group operating expenses Net operating expenses Operating profit/loss Q Profit and loss by segment Norway Denmark Netherlands Switzerland Others 1) Group Total revenues Intra-group revenues 2) Net revenues Total costs of sales Intra-group cost of sales Net cost of sales Gross profit/loss Gross margin 68 % 63 % 35 % 48 % 0 % 64 % Total operating expenses Intra-group operating expenses Net operating expenses Operating profit/loss

10 Balance sheet Norway Denmark Netherlands Switzerland Others 1) Eliminations Group Assets Liabilities Equity capital Investments Balance sheet Norway Denmark Netherlands Switzerland Others 1) Eliminations Group Assets Liabilities Equity capital Investments ) Other items include the parent company Telio Holding ASA and the subsidiary Teliofoni AB in Sweden (dormant) 2) Intra-group revenues were not fully invoiced in Q Note 6: Tangible fixed assets (Figures in NOK 1000) Q Q FY 2011 Adapters Book value beg. of period Additions Depreciation Book value end of period Other equipment Book value beg. of period Additions Depreciation Book value end of period Total tangible fixed assets Note 7: Intangible assets (Figures in NOK 1000) Q Q FY 2011 Customer acquisition costs Book value beg. of period Additions Depreciation Book value end of period Technology platform Book value beg. of period Additions Depreciation Book value end of period Other intangible assets Book value beg. of period Additions Depreciation Book value end of period Total intangible assets

11 Note 8: Finance Net finance of NOK -1.6 million in Q includes net unrealized foreign exchange loss of NOK 1.3 million related to inter-company loans. Note 9: Inventory Inventory relates to hardware terminals for sale to customers. The terminals are financed through a financial lease.

12 Financial information Q Telio reports revenues of NOK 98.5 million in 1st quarter EBITDA was NOK 28.1 million (EBITDA margin of 28.5%) and EBIT was NOK 18.2 million. Total gross profit in Q1 12 was NOK 63.1 million (64.1% margin) compared to NOK 62.6 million (63.8% margin) in Q1 11. Average monthly revenue per customer (VoIP Norway) during Q1 12 was NOK 207 compared to NOK 210 in the previous quarter. Average monthly gross profit per customer for Norwegian VoIP customers was NOK 153 during the quarter compared to NOK 154 in the previous quarter. Salaries and personnel costs were NOK 16.3 million in Q1 12 (16.5% of revenues). The company capitalized NOK 3.9 million in development costs during the quarter. Selling and marketing costs were NOK6.1 million in Q1 12 (6.2% of revenues). The company capitalized customer acquisition costs of NOK 6.4 million during the quarter. Cash flow from operations was NOK million in the quarter after payment of NOK 50 million in VAT for previous years (accrued as of 31 December 2011). Cash and cash equivalents were NOK 59.6 million at 31 March. Consolidated equity was NOK 35.6 million (equity ratio of 23%) compared to NOK 89.0 million (45%) at the end of Q Deferred revenues (current liabilities) increased by NOK 0.5 million during the quarter. Deferred revenues at the end of Q1 12 were NOK 18.7 million of which NOK 2.4 million has been collected and is nonrefundable. Total financial lease debt was NOK 12.8 million at the end of the quarter which is NOK3.4 million below the end of the previous quarter (NOK 16.2 million). Of the total financial lease debt, NOK 11.5 million was classified as current liabilities (payable within one year from the balance sheet date). 1 (Figures in NOK 000) st quarter 4 th quarter 3 rd quarter 2 nd quarter 1 st quarter Total revenue 98,475 95,850 94,048 97,236 98,083 Gross margin (%) 64% 64% 63% 65% 64% Operating profit *) 18,210 18,038 20,506 23,509 23,030 Operating margin (%) 19% 19% 22% 24% 24% EBITDA *) 28,101 27,576 29,624 33,229 33,290 EBITDA margin (%) 29% 29% 32% 34% 34% EPS (NOK) 0.67 (1.18) EPS (NOK) fully diluted 0.66 (1.16) *) Q figures are before one-off costs related to VAT claim

13 Company Facts Telio Holding ASA Harbitzalleen 2A P.O. Box 54 Skøyen 0212 Oslo Telephone: Homepage: Company reg. number: Founded: 12 August 2003 Board of Directors Erik Osmundsen (Chairman) Aril Resen Liv Bergtorsdottir Arnhild Schia Haakon Dyrnes Group Management Eirik Lunde, Chief Executive Officer Tom Nøttveit, Chief Financial Officer Alan Duric, co-founder and Chief Technology Officer Jens Hetland, Sales & Marketing Director (Residential) Nina Forsberg Mathiesen, Director Customer Services Thomas Gunleiksrud, Sales & Marketing Director (Business) Erik Trondsen, Product Director Investor Relations Tom Nøttveit, Chief Financial Officer Telephone: address: Financial Calendar 1 st quarter 2012: 26 April at 09:00 2 nd quarter 2012: 15 August at 09:00 3 rd quarter 2012: 25 October at 09:00 Annual General Meeting: 12 April 2012 at 11:00 Equity Research Coverage Company Contact Phone Carnegie Espen Torgersen SEB Enskilda Peder Strand First Securities Harald Hornes Øyen