9 month results underline solid business performance
Munich, November 7, 2007 – During the first nine months of 2007 telegate confirms its successful track. With sales in line with last year, telegate managed to raise profitability and free cash flow, whilst making vital progress toward expanding its business in commercial advertisement sales.
During the reporting period telegate Group generated sales of 131.5 million Euro (9 months period 2006: 133.8 million Euro). Growth rate comes close to 6 percent when adjusted by the outsourcing sales made with the French mobile telecommunication partners SFR und Bouygues Telecom that do not affect net income but were still included in the comparative period of the previous year. Earnings before interest, taxes, depreciation and taxes (EBITDA) rose sharply over the same period to 36.3 million Euro (9 months period 2006: 4.7 million Euro). The good quality of earnings is even more evident for earnings after taxes: at 25.3 million Euro telegate was clearly up year-on-year (9 months period 2006: -4.0 million Euro). Direct comparison of the quarters also confirms this positive development: earnings after taxes for the third quarter 2007 came to 9.7 million Euro (Q3 2006: 5.4 million Euro), with EBITDA at 12.8 million Euro (Q3 2006: 9.3 million Euro).
The development of free cash flow is also extremly healthy. At 43.2 million Euro it reached a new record level for the nine month period, (9 months period 2006: -23,4 million Euro). This in turn results in higher free liquidity of 53.0 million Euro per September 30, 2007. This figure also includes payment of 12.3 million Euro by Deutsche Telekom AG for legal claims brought for excessively charged data costs over the years 1997 to 2004. As these monies were paid subject to an enforceable legal verdict they are as yet booked not affecting earnings.
All three business segments of telegate Group contributed toward this positive performance with their different focal points.
The segment Germany/Austria saw the performance in the new business lines value-added telephone services and advertisement sales outperform expectations and balancing declining revenues from the classical core business. With sales of 85.3 million Euro (9 months period 2006: 85.7 mil-lion Euro) the segment clocked up an EBITDA of 34.1 million Euro (9 months period 2006: 27.4 million Euro).
The business segment Italy/Spain continues its positive development. Sales are up by 19 percent to 29.7 million Euro (9 months period 2006: 25.0 million Euro) with profitability also significantly up. EBITDA comes to 5.1 million Euro (9 months period 2006: 3.7 million Euro), which constitutes a plus of almost 38 percent.
The general trend for the French segment is also encouraging. Adjusted sales in the reporting period increased to 16.5 million Euro (9 months period 2006: 13,4 million Euro) and the third quarter also posted for the first time a break-even of earnings. For the first nine months the EBITDA incurred in this segment therefore continue to -3.0 million Euro (first nine months of 2006: -26.4 million Euro).
All in all, telegate Group remains optimistic on the further development of its business. The strategic expansion of the product portfolio, especially in the sectors Internet and mobile services are promising as are the progresses made in sales of commercial advertisement entries. The forecast for the full fiscal year 2007 continues to remain positive, with telegate expecting to generate an EBITDA close to 50 million Euro.
Press Contact:
telegate AG
Claudia Strixner
Fraunhoferstr. 12a
D-82152 Martinsried,
München
Tel.: (089) 89 54-1180
Fax: (089) 89 54-1189
E-Mail: presse@telegate.com
www.telegate.com
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