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GO improves revenues and profitability during first six months of the year
Caption: As part of its programme of continuous investment, GO also reopened its refurbished outlet at Baystreet during the first half of 2017.
GO plc has announced improved results for the six month period to 30 June 2017, with growth in revenues and profitability as well as robust cash generation. Operating profit increased by 18.8 per cent to €14.6 million (2016: €12.3 million) whilst, during the same period, revenues grew by 5.6 per cent to €81 million (2016: €76.7 million). Earnings before interest, tax, depreciation and amortisation (EBITDA) also increased by 9 per cent to €32.6 million (2016: €29.9million).
GO noted that this continued growth in revenues has been driven by strategic investments both in Malta as well as in Cyprus. These significant investments in its networks and support solutions, processes and media content, have continued to improve the customer experience and to enhance the Group's product line-up.
In the Maltese market, the ongoing rollout of Fibre-to-the-Home ("FTTH") is leading to growth in GO's Broadband and TV client base, as the reach of FTTH extends to additional towns and villages and now exceeds 50,000 homes passed. GO also continues to enjoy a solid customer base of fixed-voice connections. Moreover GO, which has Malta's only fibre connected 4G network, has over the past two years made significant investments in mobile. This enables GO's mobile customers to enjoy the fastest mobile network, as recently certified by Net Check, an independent German firm that specialises in evaluating the quality of mobile networks. The enhanced customer experience is leading to a larger mobile customer base and growth in usage of mobile data. These investments are matched by ongoing improvements in GO's product portfolio and customer service. Consequently, the number of customer connections has further increased to over 530,000, a significant portion of which through bundled services.
In the Business segment, GO continues to lead in providing total communications solutions. Continued investment in Kinetix and in a new state of the art data centre which is currently being constructed will further strengthen the Group's infrastructure which is already unmatched in terms of capabilities, resiliency and redundancy.
In Cyprus, Cablenet continues to invest in expanding its network to reach additional towns and suburbs and to enhance network resiliency; these investments will be stepped up in the coming years. Cablenet's customer base continues to grow and now exceeds 58,000. As a result, Cablenet is also delivering growth in revenue and profitability.
Cost of sales and administration costs amounted to €67 million, an increase of €2.1 million over the comparative period. This increase in costs is primarily directly related to increased retail activity whilst maintaining a strong focus on cost containment. For the period under review the Group is reporting a profit before tax of €13.5 million. Although this represents a reduction over the profit of €17.1 million reported for the comparative period, the reduction is due to the comparative results including an exceptional gain of €6.1 million arising on the re-measurement of the investment in Cablenet following further acquisition of shares in January 2016.
Cash generation from operations remains strong across the entire Group and amounted to €28.6 million during the period under review. The Group continues to enjoy a healthy financial position; as at 30 June 2017 the Group had a total asset base of €247.6 million which are 43.2% funded through equity. During the first six months of 2017, borrowings net of cash holdings decreased from €64.1 million as at 31 December 2016 to €58.2 million as at 30 June 2017.
GO CEO Attila Keszeg, said, "GO is a fantastic company with many great people, all of whom contribute to achieving such positive results. As Malta's communications services provider GO will, as it always has done, meet the changing and growing needs of our domestic and business customers, by investing in infrastructure, systems and people. GO remains totally committed to Malta and to providing the infrastructure and services the country needs to continue to succeed going forward."
GO Chairman Nizar Bouguila said: ‘'We are naturally satisfied with these positive results across both of our markets in Malta and Cyprus. The fact that our Group's performance is consistently robust is encouraging. It also validates our clear and focussed long term strategy of investment and technological innovation. Importantly, GO's positive track record demonstrates that it is indeed possible for a Malta-based telecommunications business to deliver strong value to clients, employees and shareholders whilst also committing to the substantial investments which will enable Malta to keep abreast of the future.''
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