LONDON--(BUSINESS WIRE)--Magyar Telecom B.V. (“Matel B.V.”) announced today that on August 14, 2015 (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 second quarter ended June 30, 2015. The Condensed Interim Consolidated Financial Statements of the Company are available at http://invitel.hu/english under “Investor Relations.”
The results for the second quarter and six months ended June 30, 2015 reflect the consolidated financial results of Magyar Telecom 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.
RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 2015
When comparing the financial results for the six months ended June 30, 2015 to the financial results for the six months ended June 30, 2014, the reported results in euro have been affected by the difference between the average HUF/EUR exchange rates in the periods. The Hungarian forint depreciated against the euro by 0.2% with an average HUF/EUR exchange rate of 307.45 during the six months ended June 30, 2015 compared to the average HUF/EUR exchange rate of 306.94 during the six months ended June 30, 2014.
The Company’s revenue was EUR 73.2 million for the six months ended June 30, 2015 which represents a 2% decrease compared to the six months ended June 30, 2014. Segment gross margin decreased by 1% from EUR 59.1 million for the six months ended June 30, 2014 to EUR 58.6 million for the six months ended June 30, 2015. General operating expense decreased by 5% from EUR 40.9 million for the six months ended June 30, 2014 to EUR 38.9 million for the six months ended June 30, 2015. Result from operations changed to a loss of EUR 0.4 million for the six months ended June 30, 2015 from a loss of EUR 3.4 million for the six months ended June 30, 2014, mainly as a result of lower operating expenses and lower depreciation and amortization. Net result for the six months ended June 30, 2015 was a loss of EUR 9.1 million compared to a loss of EUR 12.3 million for the six months ended June 30, 2014.
Residential Voice – Residential Voice segment gross margin was EUR 12.0 million for the six months ended June 30, 2015, representing a decrease of 2% compared to the six months ended June 30, 2014. This decrease was mainly due to the decrease in our Residential Voice revenue as a result of the decrease in the number of our Residential Voice subscriptions.
Residential Internet & TV – Residential Internet & TV segment gross margin was EUR 11.7 million for the six months ended June 30, 2015, representing an increase of 1% compared to the six months ended June 30, 2014. This increase was mainly due to the increase in the number of TV subscriptions.
Cable – Cable segment gross margin was EUR 7.2 million for the six months ended June 30, 2015, representing an increase of 9% compared to the six months ended June 30, 2014, mainly due to the increase in our customer base and the improvement of ARPU.
Corporate – Corporate segment gross margin was EUR 20.3 million for the six months ended June 30, 2015, representing a decrease of 4% compared to the six months ended June 30, 2014. This was mainly due to the decrease in Corporate voice revenue as a result of the decrease in traffic and price erosion on contract renewals partially offset by the increase in our Corporate IT Services business.
Wholesale – Wholesale segment gross margin was EUR 7.4 million for the six months ended June 30, 2015, representing a decrease of 3% compared to the six months ended June 30, 2014. This decrease was mainly due to the decrease in Wholesale voice revenue which more than offsets higher dark fiber sales.
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 Condensed Interim Consolidated Statement of Profit and Loss and Other Comprehensive Income in the Condensed Interim Consolidated Financial Statements of the Company:
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Reconciliation of Segment Gross Margin to Income / (Loss) from Operations |
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| (euro in millions) | 2015 | 2014 | 2015 | 2014 | ||||||||||||
| Residential Voice | 12.0 | 12.2 | 6.0 | 6.2 | ||||||||||||
| Residential Internet & TV | 11.7 | 11.6 | 5.8 | 5.9 | ||||||||||||
| Cable | 7.2 | 6.6 | 3.6 | 3.3 | ||||||||||||
| Corporate | 20.3 | 21.1 | 10.2 | 10.5 | ||||||||||||
| Wholesale | 7.4 | 7.6 | 3.0 | 3.9 | ||||||||||||
| Segment gross margin | 58.6 | 59.1 | 28.6 | 29.8 | ||||||||||||
| Network operating expenses | (7.6 | ) | (8.6 | ) | (3.8 | ) | (4.5 | ) | ||||||||
| Direct personnel expenses | (4.3 | ) | (3.8 | ) | (2.3 | ) | (1.3 | ) | ||||||||
| Selling, general and administrative expenses | (27.0 | ) | (28.5 | ) | (10.3 | ) | (11.9 | ) | ||||||||
| Depreciation and amortization | (20.1 | ) | (21.6 | ) | (10.3 | ) | (11.0 | ) | ||||||||
| Income / (loss) from operations | (0.4 | ) | (3.4 | ) | 1.9 | 1.1 | ||||||||||
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Other Financial Data |
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| (euro in millions) | 2015 | 2014 | 2015 | 2014 | ||||||||||
| Income / (loss) from operations | (0.4 | ) | (3.4 | ) | 1.9 | 1.1 | ||||||||
| Depreciation and amortization | 20.1 | 21.6 | 10.3 | 11.0 | ||||||||||
| EBITDA | 19.7 | 18.2 | 12.2 | 12.1 | ||||||||||
| Capex | 14.4 | 10.4 | 9.3 | 4.9 | ||||||||||
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Cash and Cash Equivalents at period end |
21.4 | 20.8 | ||||||||||||
Net cash provided by operations, which includes interest paid but excludes capital expenditure, was EUR 12.2 million for the six months ended June 30, 2015.
Commenting on the results, David Blunck, Chief Executive Officer of Invitel, noted: “The Company’s financial results for the second quarter reflect continued stabilization in our business. We are on track to deliver our stated full year 2015 expectation for EBITDA which is flat or slightly down on last year. In our Residential business we are investing in network speed. We are upgrading 160,000 homes to FTTx this year. In our Corporate business, we are investing in convergence technologies, including the initial rollout of an All-IP network later this year. These investments will help maintain our momentum in our strategic focus areas of TV and IT Services.”
CONFERENCE CALL
On August 14, 2015 (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 second quarter ended June 30, 2015.
You can participate in the conference call by dialing 0800-756-3429 (UK toll free), +1-201-689-8049 (International) or +1-877-407-9210 (U.S. toll free) and referencing “Matel B.V.”
A webcast of the call and the presentation materials will be available on Invitel’s website at http://invitel.hu/english under “Investor Relations.”
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.
| Magyar Telecom B.V. | ||||||||||||||||
| Financial Highlights | ||||||||||||||||
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(in millions of euro) |
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| Statement of Operations | ||||||||||||||||
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| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Residential Voice | 12.7 | 13.3 | 6.3 | 6.7 | ||||||||||||
| Residential Internet & TV | 15.9 | 15.5 | 8.0 | 7.8 | ||||||||||||
| Cable | 9.7 | 9.1 | 4.9 | 4.6 | ||||||||||||
| Corporate | 25.8 | 27.7 | 13.0 | 14.0 | ||||||||||||
| Wholesale | 9.1 | 9.4 | 3.6 | 4.9 | ||||||||||||
| Total Revenue | 73.2 | 75.0 | 35.8 | 38.0 | ||||||||||||
| Segment Cost of Sales | 14.7 | 15.9 | 7.3 | 8.1 | ||||||||||||
| Income/(Loss) from Operations | (0.4 | ) | (3.4 | ) | 1.9 | 1.1 | ||||||||||
| Interest Expense | 7.3 | 7.1 | 3.6 | 3.5 | ||||||||||||
| Foreign Exchange Gains/(Losses), net | (0.1 | ) | (0.5 | ) | (0.1 | ) | (0.1 | ) | ||||||||
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Gains/(Losses) on Derivative Financial Instruments |
- | (0.1 | ) | (0.1 | ) | - | ||||||||||
| Income/(Loss) for the Period | (9.1 | ) | (12.3 | ) | (2.6 | ) | (3.1 | ) | ||||||||
| Magyar Telecom B.V. | ||||||
| Financial Highlights | ||||||
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(in millions of euro) |
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| Balance Sheet | ||||||
| June 30, | December 31, | |||||
| 2015 | 2014 | |||||
| Cash and Cash Equivalents | 21.4 | 20.8 | ||||
| Other Current Assets | 20.6 | 20.7 | ||||
| Property, Plant and Equipment, net | 182.9 | 188.2 | ||||
| Total Assets | 249.5 | 254.9 | ||||
| Total Current Liabilities | 39.0 | 36.5 | ||||
| Long Term Debt | 156.1 | 154.6 | ||||
| Total Shareholders’ Equity | 45.2 | 54.3 | ||||
| Total Liabilities and Shareholders’ Equity | 249.5 | 254.9 | ||||