well9 Oct 2012 08:12
Nice rns update!
Alternative Networks plc, ("the Group") , the UK business communications service provider, today issues the following trading update, ahead of its full year results for the year ending 30 September 2012, due to be announced on 10 December 2012.
Trading for the year has continued to be positive, and profits are expected to be in line with expectations, with cash flow ahead of analyst forecasts. Highlights of the second half of the financial year are:
· Strong gains in market share in mobile - subscriber base up 13%
· High levels of cash generation raising net cash balances to £20.5m, an increase of £7.4m in H2, and delivering an expected conversion ratio of over 100% EBITDA into cash generated from operations.
· Strengthening gross margins across the Group.
· Board continues to evaluate shareholder returns, given high cash levels, including special dividends, share buy backs and earnings accretive acquisitions.
Trading performance
Growth in market share in Mobile network services has been strong with 13% annual organic growth in mobile subscribers to over 77,000 at 30 September 2012. This represents an acceleration of growth in the second half due to lower subscriber churn in the period and some significant customer wins toward the end of the year. The market remains very competitive, but our own strong performance reflects the successful adoption of the enhanced Portal services by our customers in 2012. Headline revenues have grown year on year despite continued pressures, with the EU regulation lowering data usage revenues in the last three months and with the economic climate remaining depressed. Nonetheless, gross profits have increased comparatively by approximately 6% in the first 11 months of the financial year, with improved margins, and the momentum in overall growth in profitability from mobile services remains strong.
Fixed line network services trading has been stable and broadly in line with expectations. The transition to SIP, resulting in reduced line rental revenues, and the impact of lower mobile termination rates have each continued to impact opportunities for growth. The good news is that margins have increased in spite of these factors, meaning that full year gross profits are expected to be at least in line with last year's outturn
Advanced Solutions started the year well, but economic uncertainty has resulted in slower new business investment decision making, and total revenues for the full year are expected to be approximately 5% lower than in 2011. Margins have been resilient, at similar levels to last year, which is in line with expectations.
The slowdown is principally in new IP data switch installations in the Enterprise market (Scalable). Stripping out these one off revenues, the remainder of advanced solutions is expected to have grown by around 6% over 2011, with net growth in the customer support revenue b
Sign In
Follow the stocks
