Last checked at 21 Nov 2018 07:00
Maintel Holdings PLC
Trading update
Maintel Holdings Plc (the "Group" or "Maintel") today issues the following trading update for the year ending 31 December 2018.
Maintel's transformation into a cloud and managed services provider has continued in the second half. This month alone the Group has seen two large wins on its hosted Unified Communications (UC) platform adding a total of 9,000 contracted seats, together with attached data services. This will increase the number of seats on its ICON platform to approximately 59,000, representing growth of over 40% versus the prior year. In addition, Maintel is on track to grow its managed services base year on year by around 10%.
Whilst the Group's business transformation has been encouraging, it now anticipates a lower level of revenue and EBITDA in the second half than previously expected, for two main reasons:
· Whilst new sales in H2 have been relatively strong, there has been a significant shift in mix away from short term projects where revenue and EBITDA can be quickly recognised, to longer term recurring revenue, particularly hosted UC and WAN products. This trend is forecast to continue over the remainder of the current financial year and into 2019.
· As previously reported, the Group entered H2 with a healthy backlog of project work which was expected to generate revenue in H2 2018 and into 2019. Some of the projects planned to complete in H2 have been delayed, which will adversely affect revenue and EBITDA for the remainder of the year.
As a result, the Board now expects Adjusted* EBITDA for the year ended 31 December 2018 to be in the range of £12m to £12.5m (2017 £10.9m).
It is the Board's intention for the full year 2018 dividend to again grow year on year, in line with existing guidance. In addition, it is expected that net debt will end the year at a lower level than the close of the prior financial year.
More detail on the outlook for 2019 will be provided at the time of the preliminary announcement of results in March, however the Board remains confident in delivering growth in both revenue and EBITDA for the full year to 31 December 2019.
This growth will be driven by the positive impact of the Unify customer base acquired on 29 June 2018 that is expected to generate healthy project work in 2019, the continued growth in the ICON cloud business and a number of margin enhancement initiatives across the Group.
*Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation, adjusted for share based payments and exceptional costs.
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014
For further information, please contact:
Eddie Buxton, Chief Executive 020 7401 4601
Mark Townsend, Chief Financial Officer 020 7401 4663
finnCap
Jonny Franklin-Adams / Emily Watts (Corporate Finance) 020 7220 0500
Richard Chambers (Corporate Broking)
Oakley Advisory (Financial Advisor)
Christian Maher / Victoria Boxall 020 7766 6900