GO reports drop in usage, profitability, as economic conditions bite

GO plc today reported a drop in the usage of its services and in profitability as a result of the economic slowdown.

In an interim directors' statement based on the accounts up to the end of March, the group said the its client base had continued to grow in spite of significantly increased competition across all its services. However, revenues have declined mainly as a result of reduction of usage of services, which has lead to a drop in profitability when compared to the strong performance achieved during the same period the previous year.
During the period, the group completed its programme to streamline activities so as to better serve its clients and offer a more efficient and cost-effective service.

"Although departures under the group’s voluntary retirement scheme have been low during the period, the rate of
applications has significantly increased over the past few weeks as the scheme draws to a close later this
month. The group’s aim is to reduce headcount to circa 1,000 in the short term."

GO said it was confident that operating costs would be reduced in the second half of the year as a result of the expected departure of a significant number of employees through the voluntary retirement scheme.

In its statement, it said that its investment in Forthnet continued to perform well and during this first quarter, registered growth in both revenue and EBITDA when compared to the prior year.
The Group was also continuing to invest in the upgrade of its network and had commissioned its second submarine cable link to mainland Europe.