MAGYAR TELECOM B.V. 6 St. Andrew Street, London EC4AE United Kingdom Phone Fax

Transcription

1 MAGYAR TELECOM B.V. 6 St. Andrew Street, London EC4AE United Kingdom Phone Fax FOR: MAGYAR TELECOM B.V. COMPANY CONTACT: Andrea Rába Accounting and Financial Reporting Director of Invitel Hungary: FOR IMMEDIATE RELEASE MAGYAR TELECOM B.V. ANNOUNCES FINANCIAL RESULTS FOR THE QUARTER ENDED SEPTEMBER 30, 2014 AND INVESTOR CALL LONDON (BUSINESS WIRE) November 12, 2014 Magyar Telecom B.V. ( Matel B.V. ) announced today that on November 12, 2014 (at 14:00 UK time, 15:00 CET, 9:00 AM ET), Matel B.V. will host a conference call to discuss financial results for the quarter ended September 30, The results for the quarter ended September 30, 2014 reflect the consolidated financial results of Matel B.V. and its subsidiaries (collectively, the Company ) in accordance with International Financial Reporting Standards, as adopted by the E.U. ( IFRS ). The reporting currency is euro ( EUR ), however the functional currency of operations is the Hungarian forint ( HUF ), being the currency of the primary economic environment in which the Company operates.

2 RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2014 When comparing the financial results for the nine months ended September 30, 2014 to the financial results for the nine months ended September 30, 2013, the reported results in euro have been affected by the difference between the average HUF/EUR exchange rates. The Hungarian forint depreciated against the euro by 4% with an average HUF/EUR exchange rate of during the nine months ended September 30, 2014 compared to the average HUF/EUR exchange rate of during the nine months ended September 30, The Company s revenue was EUR million for the nine months ended September 30, 2014 which represents a 6% decrease compared to the nine months ended September 30, Segment gross margin decreased by 7% from EUR 94.6 million for the nine months ended September 30, 2013 to EUR 87.9 million for the nine months ended September 30, General operating expense decreased by 13% from EUR 64.5 million for the nine months ended September 30, 2013 to EUR 56.1 million for the nine months ended September 30, 2014, mainly as a result of general cost control of operating expenses and EUR 5.5 million of expense which was related to the Restructuring. Income / (loss) from operations changed to a loss of EUR 0.8 million for the nine months ended September 30, 2014 from a loss of EUR 7.2 million for the nine months ended September 30, Net result for the nine months ended September 30, 2014 was a loss of EUR 13.9 million compared to a loss of EUR 35.1 million for the nine months ended September 30, Residential Voice Residential Voice segment gross margin was EUR 18.1 million for the nine months ended September 30, 2014, representing a decrease of 15% compared to the nine months ended September 30, The decrease was mainly due to lower acquisition ARPU of new customers.

3 Residential Internet & TV Residential Internet & TV segment gross margin was EUR 17.2 million for the nine months ended September 30, 2014 compared to EUR 17.5 million for the nine months ended September 30, 2013 representing a decrease of 2%. In functional currency terms, the gross margin of this segment has increased by 2%, mainly due to the increase in customer base, which was partially offset by a decrease in Residential Internet gross margin due to lower ADSL ARPU. Cable - Cable segment gross margin was EUR 9.9 million for the nine months ended September 30, 2014, representing an increase of 5% compared to the nine months ended September 30, 2013, mainly due to the increase in the number of customers. Corporate Corporate segment gross margin was EUR 31.4 million for the nine months ended September 30, 2014, representing a decrease of 4% compared to the nine months ended September 30, This decrease was mainly due to the decrease in Corporate voice revenue as a result of a decrease in traffic and price erosion on contract renewals, partially offset by the increase in revenue of Corporate IT Services. Wholesale Wholesale segment gross margin was EUR 11.3 million for the nine months ended September 30, 2014, representing a decrease of 16% compared to the nine months ended September 30, 2013, which is primarily attributable to the decrease of revenue of the sub 2M lines and decreasing data revenues. Segment gross margin is a non-ifrs financial measure, which is used by management to evaluate the performance of the business segments. The following table represents the reconciliation of segment gross margin to income / (loss) from operations as per the Interim Consolidated Statement of Profit and Loss and Other Comprehensive Income in the interim consolidated financial statements the Company:

4 Nine months ended September 30, (euro in millions) Residential Voice Residential Internet & TV Cable Corporate Wholesale Segment gross margin Network operating expenses (12.8) (14.1) Direct personnel expenses (5.8) (7.5) Selling, general and administrative expenses (37.5) (42.9) Depreciation and amortization (32.2) (36.1) Cost of restructuring (0.4) (1.2) Income (loss) from operations (0.8) (7.2) Net cash provided by operations, which includes interest paid but excludes capital expenditure and debt repayments, was EUR 22.1 million for the nine months ended September 30, Commenting on the results, David McGowan, Chief Executive Officer of Invitel, the Company s operating subsidiary, noted: The success of our bundling strategies is evident in the Q3 results we are reporting today. Our growing TV and Corporate IT Services businesses, along with sustained cost and capex discipline, have each contributed to the stabilization of our financial results. CONFERENCE CALL On November 12, 2014 (at 14:00 UK time, 15:00 CET, 9:00 AM ET), Matel B.V. will host a conference call to discuss financial results for the quarter ended September 30, You can participate in the conference call by dialing (UK toll free), (International) or (U.S. toll free) and referencing Matel B.V..

5 A webcast of the call and the presentation materials will be available on Invitel s website at under Investor Relations. The webcast will be available for replay until February 12, In addition, a replay of the call will be available until November 26, 2014 at 11:59 PM ET. To access the replay of the call, please dial (U.S. toll free) or internationally dial and enter the conference ID ( ). ABOUT MAGYAR TELECOM B.V. Magyar Telecom B.V., through its subsidiary, Invitel is one of the leading service providers in the Hungarian telecommunications market, offering a broad portfolio of services for residential and business customers. Residential products include a variety of multimedia and entertainment services such as interactive, digital and High Definition television, fast internet offerings and telephony services. Business solutions include the most up-to-date ICT and cloud-based IT solutions, in addition to voice and data services, all using Invitel's nationwide fiber-optic backbone network. Invitel is headquartered in Budaörs, with customer touch points throughout Hungary.

6 Magyar Telecom B.V. Financial Highlights (in millions of euro) Statement of Operations Nine months ended September 30, 2014 Nine months ended September 30, 2013 Residential Voice Residential Internet & TV Cable Corporate Wholesale Total Revenue Segment Cost of Sales Income (Loss) from Operations (0.8) (7.2) Interest Expense Foreign Exchange Gains (Losses), net (0.5) (0.1) Income (Loss) for the Period (13.9) (35.1)

7 Magyar Telecom B.V. Financial Highlights (in millions of euro) Balance Sheet September 30, December 31, Current Assets Property, Plant and Equipment, net Total Assets Total Current Liabilities Long Term Debt Total Shareholders Equity Total Liabilities and Shareholders Equity