Financial review
Go registers pre-tax profit of €27.6 million Gross final dividend of €0.179 per share Go plc published its preliminary statement of the 2007 full-year results following a board of directors' meeting held on February 27. The directors proposed a...
Go registers pre-tax profit of €27.6 million
Gross final dividend of €0.179 per share
Go plc published its preliminary statement of the 2007 full-year results following a board of directors' meeting held on February 27.
The directors proposed a final gross dividend of €0.1792 per share resulting in a net dividend of €0.1165 (Lm0.05) per share, unchanged from last year. The dividend is payable to shareholders as at close of trading on Tuesday, March 11. Additionally, a gross interim dividend of €0.0538 (Lm0.0231) per share was paid in November 2007. Therefore, the total gross dividend for 2007 remains unchanged at €0.2329 (€0.1514 net of tax).
Group turnover during 2007 increased by 2.1 per cent to €131.9 million with the directors reporting that the decline in fixed line revenue was offset by the strong growth in broadband, mobile and digital TV services. In February 2007, Go acquired the DTTV operator Multiplus Ltd and CEO David Kay revealed that the company's customer base more than doubled within a year. Mr Kay stated that there are currently around 25,000 Go Plus TV subscribers.
Cost of sales climbed 13 per cent to €80.1 million, mainly as a result of a rise in depreciation charges as well as interconnection charges. The directors confirmed that the group reviewed the estimated useful life of various technology platforms and in certain instances it was decided to accelerate the depreciation charge on some of the assets. Administrative and distribution expenses increased by 9.8 per cent to €28.8 million. These include various one-time fees related to the group re-branding exercise.
The 2007 results reflect a number of extraordinary items. Go recognised the amount of €9.6 million related to the VAT claim refund following the decision by the Court of Appeal on December 17, 2007 to reject the appeal previously filed by the VAT Department.
On the other hand, costs related to the voluntary early retirement scheme amounted to a further €4.3 million (2006: €7.3 million). Moreover, a goodwill impairment of €0.35 million was realised as well as a further impairment on an equity investment of €1.7 million
Profit before tax last year amounted to €27.6 million, representing a decline of 1.4 per cent over the previous year. After providing for a tax charge of €10.9 million, Go's profit after tax during the period under review of €16.7 million results in an earnings per share figure of €0.165.
Total assets as at December 31, 2007 of €269.3 million include financial investments of €34.4 million (2006: €31.9 million) and cash balances amounting to €47.1 million (2006: €38.9 million), resulting in total cash and cash equivalents of €81.5 million. Shareholders' funds as at December 31, 2007 totalled €196.1 million, giving a net asset value per share of €1.94.
Last month, Go plc together with its majority shareholder Emirates International Telecommunications (Malta) Ltd (EITML) purchased a 21 per cent stake in ForthNet for €93.8 million. ForthNet is a leading Greek internet service provider and an alternative fixed line and broadband operator. The Greek broadband market is the least developed internet market in Europe with a penetration rate of only 4.4 per cent in 2006 compared to an EU average of 14.9 per cent (the penetration in Malta was 12.9 per cent in 2006).
ForthNet has a strong service offering compared to its alternative network competitors and with no cable infrastructure in Greece (thus eliminating risk of alternative technologies), ForthNet is able to take advantage of its brand name and its healthy balance sheet. With over 20 per cent of the broadband market, the company ought to experience very high rates of growth should the penetration in Greece converge with the rest of Europe.
The key highlights are:
• Turnover rises 2.1 per cent to €131.9 million;
• Gross profit declines by 13 per cent to €51.8 million;
• Pre-tax profit of €27.6 million;
• Cash and cash equivalents rise to €81.5 million;
• Gross dividend yield of 7.4 per cent per annum.
FIMBank's profits climb 38% to $10.5m
1 for 5 bonus share issue and net dividend of $0.038 per share
Last Monday, FIMBank plc published its preliminary profits statement for the year ended December 31, 2007.
The directors will be recommending a one-for-five bonus share issue as well as the payment of a net dividend of $0.038 per share (2006: $0.035 per share) at the forthcoming annual general meeting scheduled to take place on April 10. Shareholders will have the option of receiving the dividend either in cash or in new shares at a price which is yet to be determined. Shareholders as at close of trading on March 10 will be entitled to the bonus issue and the dividend. The shares will trade ex-dividend as from Tuesday, March 11.
During the 12 months ended December 31, 2007 the total operating income generated by the FIMBank Group increased by 12.1 per cent to $26.8 million. Net interest income grew by 14.1 per cent to $10.5 million with non-interest income rising by 10.8 per cent to $16.3 million. The directors reported that net interest income grew in line with the increase in the bank's activity due to more lines of credit, a rise in customer and bank deposits and longer term funding sources.
Net fee and commission income, the largest component of the group's total operating income, climbed 31 per cent to $14.2 million on an increase in activity at the bank and its fully-owned subsidiary London Forfaiting Company (LFC). The directors revealed that fee income booked by LFC doubled during the year to $3.5 million.
Meanwhile, net trading income dropped from $3.1 million in 2006 to just under $2 million during the period under review as the turbulence in international financial markets impacted the bank's bond portfolio. However, this was offset by unrealised profits resulting from foreign exchange activities. The drop in the net trading income was also affected by a decrease in realised and unrealised gains in forfaiting assets to $0.8 million (2006: $1.8 million). Dividend income was minimal during the year while in 2006 the group benefited from a one-time dividend income of $0.58 million from Eastern Prospect BV.
Non-interest expenses, comprising administrative expenses and depreciation, rose 21.8 per cent to $19.8 million, mainly attributable to the start-up costs of new joint-venture associates in Egypt and Dubai and the rise in staff complement within the group.
The share of profits from the factoring associate companies (38.5 per cent shareholding in Global Trade Finance Ltd in India as well as participation in the two recently-formed factoring companies - 40 per cent in EgyptFactors and 50 per cent in MENAFactors) amounted to $4.6 million, 81.6 per cent higher than the contribution in the previous year. The group's cost-to-income ratio after taking into account the share of profits from the factoring associate companies is marginally higher than last year at 63 per cent.
Net impairment losses during 2007 dropped to $0.8 million from $1.9 million in 2006. This resulted from a decrease in specific impairment provisions, which in turn was partly offset by a rise in collective impairment charges. In 2006, FIMBank had taken a specific charge on an impaired forfaiting asset within LFC's portfolio.
Meanwhile, LFC recognised a further deferred tax asset of $1.4 million, significantly lower than the $3.4 million in 2006. $1.1 million of the deferred tax asset was used as a final adjustment to the carrying amount of goodwill.
As a result of the depletion of goodwill in the group's balance sheet, FIMBank can start benefiting from the unutilised tax credits at LFC, which amounted to over $22 million in 2007. FIMBank's profitability during 2007 increased by 38 per cent to $10.5 million giving a diluted earnings per share of $0.115. The group's balance sheet as at December 31, 2007 shows total assets of $571.3 million (2006: $463.5 million) with shareholders' funds increasing to $97.9 million following the $25 million rights issue in December 2007. This is reflected in an increase of $11.5 million in the issued share capital and a $13.8 million rise in the share premium account. The proposed one-for-five bonus share issue will capitalise circa $11 million from the share premium account.
Group commitments outstanding as at December 31, 2007, representing documentary credits, commitments to purchase assets and confirmed letters of credit, amounted to $308 million (2006: $245 million).
In the preliminary profit statement no mention was made of the shareholding in Global Trade Finance in India. On January 29, FIMBank announced that the State Bank of India (SBI) intends to acquire FIMBank's 38.5 per cent shareholding in Global Trade Finance together with the shares held by Export-Import Bank of India and the International Finance Corporation. Various articles in the local and international media claimed that SBI's purchase of a 91 per cent shareholding in GTF was agreed to at a value of INR5,250 million (equivalent to circa $135 million).
The key highlights are:
• Net fee and commission income up 31 per cent to $14.2 million;
• Total income of $26.8 million (+12.1 per cent);
• Share of profits from factoring companies of $4.6 million (+81.6 per cent);
• Profit for the year up 38 per cent to $10.5 million;
• Shareholders' funds of $97.9 million.
• Rizzo, Farrugia & Co. (Stockbrokers) Ltd (RFC) are members of the Malta Stock Exchange and licensed by the Malta Financial Services Authority. This report has been prepared in accordance with legal requirements. It contains public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The author and other relevant persons may not trade in the securities to which this report relates (other than executing unsolicited client orders) until such time as the recipients of this report have had a reasonable opportunity to act thereon. RFC may have or have had a relationship with or may provide or has provided other services of a corporate nature to companies therein mentioned. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Neither RFC, nor any of its directors or employees, accept any liability for any loss or damage arising out of the use of all or any part thereof and no representation or warranty is provided in respect of the reliability of the information contained in this report.
© 2008 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved.
Mr Rizzo is a director at Rizzo, Farrugia & Co. (Stockbrokers) Ltd
http://www.rfstockbrokers.com
Gross final dividend of €0.179 per share
Go plc published its preliminary statement of the 2007 full-year results following a board of directors' meeting held on February 27.
The directors proposed a final gross dividend of €0.1792 per share resulting in a net dividend of €0.1165 (Lm0.05) per share, unchanged from last year. The dividend is payable to shareholders as at close of trading on Tuesday, March 11. Additionally, a gross interim dividend of €0.0538 (Lm0.0231) per share was paid in November 2007. Therefore, the total gross dividend for 2007 remains unchanged at €0.2329 (€0.1514 net of tax).
Group turnover during 2007 increased by 2.1 per cent to €131.9 million with the directors reporting that the decline in fixed line revenue was offset by the strong growth in broadband, mobile and digital TV services. In February 2007, Go acquired the DTTV operator Multiplus Ltd and CEO David Kay revealed that the company's customer base more than doubled within a year. Mr Kay stated that there are currently around 25,000 Go Plus TV subscribers.
Cost of sales climbed 13 per cent to €80.1 million, mainly as a result of a rise in depreciation charges as well as interconnection charges. The directors confirmed that the group reviewed the estimated useful life of various technology platforms and in certain instances it was decided to accelerate the depreciation charge on some of the assets. Administrative and distribution expenses increased by 9.8 per cent to €28.8 million. These include various one-time fees related to the group re-branding exercise.
The 2007 results reflect a number of extraordinary items. Go recognised the amount of €9.6 million related to the VAT claim refund following the decision by the Court of Appeal on December 17, 2007 to reject the appeal previously filed by the VAT Department.
On the other hand, costs related to the voluntary early retirement scheme amounted to a further €4.3 million (2006: €7.3 million). Moreover, a goodwill impairment of €0.35 million was realised as well as a further impairment on an equity investment of €1.7 million
Profit before tax last year amounted to €27.6 million, representing a decline of 1.4 per cent over the previous year. After providing for a tax charge of €10.9 million, Go's profit after tax during the period under review of €16.7 million results in an earnings per share figure of €0.165.
Total assets as at December 31, 2007 of €269.3 million include financial investments of €34.4 million (2006: €31.9 million) and cash balances amounting to €47.1 million (2006: €38.9 million), resulting in total cash and cash equivalents of €81.5 million. Shareholders' funds as at December 31, 2007 totalled €196.1 million, giving a net asset value per share of €1.94.
Last month, Go plc together with its majority shareholder Emirates International Telecommunications (Malta) Ltd (EITML) purchased a 21 per cent stake in ForthNet for €93.8 million. ForthNet is a leading Greek internet service provider and an alternative fixed line and broadband operator. The Greek broadband market is the least developed internet market in Europe with a penetration rate of only 4.4 per cent in 2006 compared to an EU average of 14.9 per cent (the penetration in Malta was 12.9 per cent in 2006).
ForthNet has a strong service offering compared to its alternative network competitors and with no cable infrastructure in Greece (thus eliminating risk of alternative technologies), ForthNet is able to take advantage of its brand name and its healthy balance sheet. With over 20 per cent of the broadband market, the company ought to experience very high rates of growth should the penetration in Greece converge with the rest of Europe.
The key highlights are:
• Turnover rises 2.1 per cent to €131.9 million;
• Gross profit declines by 13 per cent to €51.8 million;
• Pre-tax profit of €27.6 million;
• Cash and cash equivalents rise to €81.5 million;
• Gross dividend yield of 7.4 per cent per annum.
FIMBank's profits climb 38% to $10.5m
1 for 5 bonus share issue and net dividend of $0.038 per share
Last Monday, FIMBank plc published its preliminary profits statement for the year ended December 31, 2007.
The directors will be recommending a one-for-five bonus share issue as well as the payment of a net dividend of $0.038 per share (2006: $0.035 per share) at the forthcoming annual general meeting scheduled to take place on April 10. Shareholders will have the option of receiving the dividend either in cash or in new shares at a price which is yet to be determined. Shareholders as at close of trading on March 10 will be entitled to the bonus issue and the dividend. The shares will trade ex-dividend as from Tuesday, March 11.
During the 12 months ended December 31, 2007 the total operating income generated by the FIMBank Group increased by 12.1 per cent to $26.8 million. Net interest income grew by 14.1 per cent to $10.5 million with non-interest income rising by 10.8 per cent to $16.3 million. The directors reported that net interest income grew in line with the increase in the bank's activity due to more lines of credit, a rise in customer and bank deposits and longer term funding sources.
Net fee and commission income, the largest component of the group's total operating income, climbed 31 per cent to $14.2 million on an increase in activity at the bank and its fully-owned subsidiary London Forfaiting Company (LFC). The directors revealed that fee income booked by LFC doubled during the year to $3.5 million.
Meanwhile, net trading income dropped from $3.1 million in 2006 to just under $2 million during the period under review as the turbulence in international financial markets impacted the bank's bond portfolio. However, this was offset by unrealised profits resulting from foreign exchange activities. The drop in the net trading income was also affected by a decrease in realised and unrealised gains in forfaiting assets to $0.8 million (2006: $1.8 million). Dividend income was minimal during the year while in 2006 the group benefited from a one-time dividend income of $0.58 million from Eastern Prospect BV.
Non-interest expenses, comprising administrative expenses and depreciation, rose 21.8 per cent to $19.8 million, mainly attributable to the start-up costs of new joint-venture associates in Egypt and Dubai and the rise in staff complement within the group.
The share of profits from the factoring associate companies (38.5 per cent shareholding in Global Trade Finance Ltd in India as well as participation in the two recently-formed factoring companies - 40 per cent in EgyptFactors and 50 per cent in MENAFactors) amounted to $4.6 million, 81.6 per cent higher than the contribution in the previous year. The group's cost-to-income ratio after taking into account the share of profits from the factoring associate companies is marginally higher than last year at 63 per cent.
Net impairment losses during 2007 dropped to $0.8 million from $1.9 million in 2006. This resulted from a decrease in specific impairment provisions, which in turn was partly offset by a rise in collective impairment charges. In 2006, FIMBank had taken a specific charge on an impaired forfaiting asset within LFC's portfolio.
Meanwhile, LFC recognised a further deferred tax asset of $1.4 million, significantly lower than the $3.4 million in 2006. $1.1 million of the deferred tax asset was used as a final adjustment to the carrying amount of goodwill.
As a result of the depletion of goodwill in the group's balance sheet, FIMBank can start benefiting from the unutilised tax credits at LFC, which amounted to over $22 million in 2007. FIMBank's profitability during 2007 increased by 38 per cent to $10.5 million giving a diluted earnings per share of $0.115. The group's balance sheet as at December 31, 2007 shows total assets of $571.3 million (2006: $463.5 million) with shareholders' funds increasing to $97.9 million following the $25 million rights issue in December 2007. This is reflected in an increase of $11.5 million in the issued share capital and a $13.8 million rise in the share premium account. The proposed one-for-five bonus share issue will capitalise circa $11 million from the share premium account.
Group commitments outstanding as at December 31, 2007, representing documentary credits, commitments to purchase assets and confirmed letters of credit, amounted to $308 million (2006: $245 million).
In the preliminary profit statement no mention was made of the shareholding in Global Trade Finance in India. On January 29, FIMBank announced that the State Bank of India (SBI) intends to acquire FIMBank's 38.5 per cent shareholding in Global Trade Finance together with the shares held by Export-Import Bank of India and the International Finance Corporation. Various articles in the local and international media claimed that SBI's purchase of a 91 per cent shareholding in GTF was agreed to at a value of INR5,250 million (equivalent to circa $135 million).
The key highlights are:
• Net fee and commission income up 31 per cent to $14.2 million;
• Total income of $26.8 million (+12.1 per cent);
• Share of profits from factoring companies of $4.6 million (+81.6 per cent);
• Profit for the year up 38 per cent to $10.5 million;
• Shareholders' funds of $97.9 million.
• Rizzo, Farrugia & Co. (Stockbrokers) Ltd (RFC) are members of the Malta Stock Exchange and licensed by the Malta Financial Services Authority. This report has been prepared in accordance with legal requirements. It contains public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The author and other relevant persons may not trade in the securities to which this report relates (other than executing unsolicited client orders) until such time as the recipients of this report have had a reasonable opportunity to act thereon. RFC may have or have had a relationship with or may provide or has provided other services of a corporate nature to companies therein mentioned. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Neither RFC, nor any of its directors or employees, accept any liability for any loss or damage arising out of the use of all or any part thereof and no representation or warranty is provided in respect of the reliability of the information contained in this report.
© 2008 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved.
Mr Rizzo is a director at Rizzo, Farrugia & Co. (Stockbrokers) Ltd
http://www.rfstockbrokers.com