GO plc - Full-Year Results

Friday, March 8th, 2019

On 8 March 2019, GO plc published the preliminary statement of annual results for the financial year ended 31 December 2018.

Performance Overview

During 2018, GO generated €171.8 million in revenues, representing an increase of 3.3% over the previous comparable period. In this respect, the company explained that despite the highly competitive operating environment, it continued to register growth across most of its business lines in both Malta and Cyprus (through Cablenet Communications Systems Limited) and in the retail and business segments on the back of ongoing investments in the latest infrastructure (including the continued rollout of the fibre-to-the-home network in Malta) as well as the provision of a positive customer experience.

Despite the increased volumes of sales, cost of sales eased by 0.5% to €96.1 million. As a result, gross profit increased by 8.6% to €75.7 million whilst the gross profit margin improved to just over 44% from 41.9% in 2017.

Administrative and other operating costs increased by 6.1% to €42.7 million. However, this figure includes a charge of €2.7 million related an early voluntary retirement scheme compared to just €0.1 million in 2017. Accordingly, on an adjusted basis, operating costs eased by 0.4%. Furthermore, when excluding depreciation and amortization costs, EBITDA grew by 6% to €69.5 million compared to €65.6 million in the previous comparable period. The EBITDA margin climbed back above the 40% mark to 40.4%. Meanwhile, the financial results of GO were also positively impacted by lower net finance costs as these amounted to €1.42 million compared to €1.85 million in 2017.

Overall, GO reported a pre-tax profit of €31.7 million, representing an increase of 13.6% over the comparable figure for the 2017 financial year. After accounting for a tax charge of €11.2 million and minority interests of €1.47 million (pertaining to the 49% share of Cablenet not owned by GO), the net profit figure for the year amounted to €16.7 million. This also represents a growth of 13.6% and translates into a return on average equity of 17.3%.

The Statement of Financial Position shows that total assets grew by 1.4% to €255.4 million, largely reflecting the additional investments in property, plant and equipment (+€10.5 million) which were partly offset by lower value of intangible assets (-€4.7 million) and cash balances (-€2 million). Likewise, total liabilities contracted by 1.1% to €135.3 million as the slight increase in total debt to €68.3 million was offset by the reductions in trade and other payables. Net debt increased by 4.3% to €56.5 million. However, in view of the improved profitability of the company, the net debt-to-EBITDA multiple eased to 0.81 times as at 31 December 2018 compared to 0.83 times as at the end of 2017. Meanwhile, shareholders’ funds grew by 5.4% to €112.6 million compared to €106.9 million as at 31 December 2017.

Ordinary Dividend

Following the 18.2% increase in the net dividend for the 2017 financial year, the Directors of GO are now recommending an increase in the net dividend of a further 7.7% to €0.14 per share for the 2018 financial year. This is payable on 30 May 2019 to all shareholders as at the close of trading on 24 April 2019 subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on 28 May 2019.

Special Interim Dividend

The Board of Directors of GO also resolved to approve the payment of a special interim net dividend of €0.41 per share for the 2019 financial year. This translates into a further cash distribution of €41.5 million, and is related to the profits generated by GO from the sale of 49% shareholding in BMIT Technologies plc following the successful IPO in January 2019. This is also payable on 30 May 2019 to all shareholders as at the close of trading on 24 April 2019 subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on 28 May 2019.

Download

GO plc – Preliminary Statement of Group Results for the financial year ended 31 December 2018.

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