GO plc - Interim Results

During a Board of Directors meeting held on 15 September, Maltacom’s interim results for the six months ended 30 June 2005 were approved for publication.

During the first six months of 2005, Group turnover dropped marginally by 0.8% to Lm26.7 million. However a 13.4% decrease in cost of sales to Lm12.9 million resulted in a gross profit of Lm13.7 million during the first half of 2005, representing a 15.1% rise over the same period last year. The Group’s gross profit margin improved from 44.3% in June 2004 to 51.4%.

Earnings before interest, tax, depreciation, and amortisation (EBITDA) amounted to Lm11.54 million, a slight rise over the first six months of last year. The EBITDA margin edged up from 42.3% in June 2004 to 43.2% – which compares favourably with the foreign telecoms sector which is currently trading on a margin of 35.4% . Administrative and distribution expenses increased by 4.8% to Lm5.5 million with other operating expenses of Lm1.2 million. Maltacom’s operating profit increased by 15.2% to Lm7.5 million. As a result of the increased holdings of financial assets, income emanating from these investments amounted to Lm350,000 (June 2004: Lm113,000). Meanwhile interest payable dropped to Lm248,000 as a result of a continuing decrease in loans and borrowings. The impairment loss of Lm372,000 relating to the minor shareholding in Intelsat Ltd. was reversed but was almost compensated for by the actual loss on realisation of Lm308,000.

The Group’s profit before tax for the first six months of the year increased by 24.1% to Lm6.7 million. After accounting for taxation, profit for the period under review amounted to Lm5.1 million compared to Lm4.1 million in the same six months of last year. The Group’s earnings per share increased by 25% to 5c0.

Total assets as at 30 June 2005 stood at Lm113.6 million. The Group’s holding of financial assets increased from Lm4.7 million in June 2004 to Lm10.7 million. Cash balances as at the balance sheet date amounted to Lm14.7 million. The increase in cash was primarily as a result of the significant drop in debtor balances (from Lm24.5 million in December 2004 to Lm16.6 million) following increased efforts by Maltacom to enforce penalties on those customers who default on the payment of their bills. Maltacom's net debt continued to decrease and at the end of June amounted to a mere Lm0.6 million (this excludes the financial investments of Lm10.7 million) compared to Lm11.8 million in June 2004 and Lm5.6 million in December 2004. The gearing ratio as at the end of June is of just 0.8% (June 2004: 15.4%).

Shareholders' funds of Lm81.3 million translate into a book value per share of 80c2.

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