GO plc - Full-Year Results

On 11 March 2021, GO plc published the Annual Report and Financial Statements for the year ended 31 December 2020.

Performance Overview

During 2020, revenues increased by 4.2% to a record of €185.2 million (2019: €177.8 million) as the higher contributions from the Group’s subsidiary in Cyprus – Cablenet Communication Systems plc (“Cablenet”) – as well as BMIT Technologies plc (“BMIT”) outweighed the marginal drop of 0.9% in sales from the local telecommunications segment to €115.2 million (2019: €116.3 million).

In Malta, GO continued to experience higher demand for fixed telecommunications services as more people upgraded their broadband services to higher speeds. However, this was offset by the significant reduction in roaming and other international wholesale revenues which were negatively impacted by international travel restrictions in response to the COVID-19 pandemic. In contrast, BMIT registered a 6.3% increase in revenues to a record of just under €24 million (2019: €22.4 million) reflecting robust demand for cloud services, connectivity, Artificial Intelligence (“AI”) assistance as well as cyber-security. Similarly, Cablenet registered a 17.9% growth in revenues to €47 million (2019: €39.8 million) as the company continued with its expansion plans both in terms of infrastructural capabilities (through further penetration of its state-of-the art Fibre Optic Network) as well new customer onboarding.

Operating costs net of other income increased by 7.8% to €163.8 million (2019: €151.9 million) reflecting higher HR costs (+€5.04 million) which includes a €2.32 million increase in voluntary retirement costs to €4.98 million; additional third-party network charges and investments in TV content (+€3.56 million); as well as higher depreciation and amortisation charges (+€3.46 million) to €50.8 million compared to €47.3 million in 2019. Excluding, depreciation and amortisation charges, normalised EBITDA (i.e. excluding the impact of voluntary retirement costs) increased by 1.7% to €77.1 million (2019: €75.9 million) but the normalised EBITDA margin eased to 41.6% compared to 42.7% in the 2019 financial year. On an aggregate basis, operating profit contracted by 17.5% to €21.3 million compared to €25.8 million in 2019.

The financial performance of GO was boosted by a €3.1 million gain on the disposal of the shares in Forthnet S.A. after this investment was entirely written-off in previous years. On the other hand, GO recorded higher net finance costs (+4.2% to €3.5 million) as the reduction in bank borrowings (-9.7% to €62.5 million) was offset by the issuance of the new €40 million unsecured bonds by Cablenet in August 2020.

Overall, GO reported a pre-tax profit of €20.9 million representing a decline of 8.3% from the €22.8 million figure recorded in 2019. After accounting for a tax charge of €6.87 million (2019: €9.84 million) and minority interests of €0.76 million (2019: €1.33 million), GO’s net profit for 2020 amounted to €13.3 million compared to €11.7 million in 2019. This translates into an earnings per share of €0.1312 (2019: €0.1151) and a return on average equity of 11.9% (2019: 10.5%).

The Statement of Financial Position shows that total assets grew by 9% to €357.4 million largely reflecting the significant increase of €25.6 million in cash balances to €33 million, as well as the higher balance of trade and other receivables (+€6.45 million). Similarly, total liabilities increased by 14.3% to €231 million as total debt increased to €155.8 million (when including lease and football rights liabilities amounting to €54 million) compared to €129.4 million as at the end of 2019. The net debt to normalised EBITDA increased marginally to 1.6 times compared to 1.5 times in 2019. Overall, shareholders’ funds grew by 2.5% to €113.1 million compared to €110.4 million as at 31 December 2019.

Ordinary Dividend

The Directors of GO are recommending a net dividend of €0.16 per share which is the highest ordinary cash dividend ever recommended by the Group. This is payable on 31 May 2021 to all shareholders as at the close of trading on 23 April 2021 subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held remotely on 27 May 2021.

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GO plc – Annual Report & Financial Statements for the year ended 31 December 2020.

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