Cablenet Communication Systems plc - Updated Financial Analysis Summary

May 8, 2023

On 08 May 2023, Cablenet Communication Systems plc published an updated Financial Analysis Summary. The following are the main highlights of the expected financial performance and financial position of Cablenet Communication Systems plc in 2023:

Revenues are anticipated to increase by a further 15.1% to a record of €73.5 million on the back of further growth in business especially in the mobile segment.
EBITDA is expected to surge by 15.6% to €20.3 million from €17.5 million in 2022. Moreover, the EBITDA margin is projected to hold around the same level at 27.6% in 2023.
Nonetheless, part of this expected improvement is anticipated to be offset by higher depreciation and amortisation charges (reflecting the Company’s continued investment in its infrastructure and service offering) amounting to €21.4 million compared to €19.7 million in 2022. Furthermore, net finance costs are also expected to increase, by 8.8% to €3.4 million on the back of additional borrowings.
Overall, Cablenet is expecting to post a net loss of €4.6 million. As a result, the company’s equity base is anticipated to contract further to €2.5 million from €3.1 million as at the end of 2022.
In terms of financial position, cash balances are anticipated to drop by €1.2 million to €2.5 million as the company continues with its strong drive of expanding and strengthening its network infrastructure. On the other hand, total debt is expected to increase by 10.8% to €52.5 million mainly reflecting an additional loan from its major shareholder, GO plc, of up to €6 million. As a result of the drop in equity and the increase in total debt (excluding lease liabilities), the gearing ratio (calculated as total debt divided by total debt plus equity) is expected to increase to 94.9% (31 December 2022: 89.2%). Nonetheless, given the forecasted increase in EBITDA, the net debt to EBITDA multiple is expected to remain practically unchanged at 2.5 times. Meanwhile, the interest cover is expected to marginally improve to 6.0 times from 5.6 times in 2022.