Go registers net loss after tax of €5.22 million
Go plc has registered a net loss after tax of €5.22 million between January and June, compared to a net loss of €4.86 million for the six-month period to 30 June 2009.
After providing for net finance costs amounting to €1.27 million and the group’s share of the results of the investment in Forgendo Limited amounting to €7.03 million, as well as the adjustment to the carrying amount of the investment in Forgendo following the capitalisation of interest free loan, the group’s loss before taxation amounted to €0.65 million, compared to a restated loss of €4.49 million in the comparative period.
In a company announcement, the group said the company made an operating profit of €11.24 million in the first six months of this year, a significant improvement over the loss of €0.25 million registered in 2009.
The improvement in the operating performance of the group is due to both improved revenues as well as lower costs, the company said in its report of the January 1 – June 30 results.
The group’s revenue amounted to €64.19 million against €59.89 million in 2009 representing a 7.2 per cent growth. The group experienced strong growth in broadband, data and television services, which compensated for the decline in traditional fixed voice services.
Developments in the mobile market in the second half of last year led to a marginal decline in revenue from mobile operations in spite of growth in the subscriber base.
Revenue from the BM companies in which the group acquired 60 per cent shareholding in April last year, amounted to €4.89 million and represented a key growth area for the group.
The cost of sales amounted to €38.06 million and although they represented growth of 5.1 per cent over the €36.2 million registered in 2009, the increase was directly related to the revenue generated by the BM companies.
GO plc managed to significantly reduce its cost of sales and administrative expenses with the main reductions coming from payroll and various discretionary cost items.
The reduction in costs was mitigated by increased electricity expense and costs directly related to increased sales activity, primarily television.
The group’s earnings before interest, tax, depreciation and amortisation and before significant one-off items amounted to €23.13 million as against €19.86 million in the comparative period, an increase of 16.5 per cent.
The group continued to generate free cash flows from its operations, which funds were utilised to finance the group’s investments, in particular those aimed at strengthening the group’s various wire line and wireless networks.
23 Comments
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G. Mangion
Sep 3rd 2010, 18:30
GO, will be losing more custmers esp when the Family home pack Expires !!! Better off with ann old antenna with a booster than this reapeted crap they are transmitting !! Now they want us to pay for GO Star too !!! GO never again ....... We need a more reliable Company here and a foriegn one , then we will see real competion, Il - Monopolju QATT MA SPICCA !!
Christopher Debattista
Sep 3rd 2010, 14:13
I totally agree with you Mr Vella. However they should change the title of the headline. This is bad publicity and will harm the business since people will think that Go is operating badly !
E Vella
Sep 3rd 2010, 14:45
i do agree with you however newspapers have to attract interest in readers to read their articles.
the biggest problem is that most of the people commenting in here are writing comments without even reading the whole article most probably. or else they don;t understand anything about finance.
the usual maltese gemgem :(
E Vella
Sep 3rd 2010, 13:57
before some of you start talking crap... the company made an operating profit of 11.24 million euros. some of you are wrong in saying that the company is operating at a loss. it is making profits in services provided in TV, mobile, etc.
The loss of 5.22 million euros is mainly attributed to an investment in Forgendo, which turned an operating profit into an overall loss making.
so pleaseeee stop talking crap, by saying that the loss was due to increase in costs of Go Sports, or lack of revenue, or increased overheads, etc etc.
read well the article... and obviously have a good knowledge of business and financial reporting, before starting to talk like finance experts.
Michael Grech
Sep 3rd 2010, 10:29
When GO (then Telemalta) was a supposedly-inefficient, govnment owned company that had so many overheads (at least that is what we were told), it not only used to register a profit, but make up for other government owned institutions that provided a service to people but were not financially stable. NOw that we followed the trend and sold the company to private owners, the company is registering a loss. Are we sure that the neo-liberal dogma as to private ownership entailing efficiency, gains and better running is that true after all? Or is this simply an excuse to force sacrificies and harsher conditions down their workforce's throat?
Alexander Farrugia
Sep 3rd 2010, 10:28
When they install the infrastructure for HD content, their loss should be even higher initially. I hope this loss will not deter them from providing us with HD content in the near future.
Christian Vella
Sep 3rd 2010, 14:01
Well, GO's playout system is all HD ready, the only thing stopping them is the limited frequencies they are able to transmit on. Wait a few more months untill they'll have an alternate to DTTV.
Simon Borg
Sep 3rd 2010, 08:14
Get a decent movie channel ( GO Stars was a good start but could be better), have HD channels available and keep the price as is now for Gold subscribers . That is what Melita subscribers are waiting for the make the switch to GO. Come on GO, wake up.
D Vella
Sep 1st 2010, 15:20
\
Get those extra TV Stations on your package and you will see the thousands who are fed up to the teeth with Melita flocking to you. I'm one.
joe borg
Sep 3rd 2010, 09:35
sure all those free to air stations on satellite and we still have to pay extra in order to watch them, no to mention the disastrous internet connections which is constantly failing and what about the mail system, it has become a viagra advert site.
i had to change my password because i don;t want my kids to go into it and read them, although i have complained an enourmous amount of times that unwanted advertising on private property is a crime, no one ever even answered me
R. Mallia
Sep 1st 2010, 13:06
I think my comment was understood wrongly. It was sarcastic i.e. when liaising with the Commission they will surely use the loss they had as an excuse for charging the highest call rates per min in Europe. How sad!
Adrian Gouder
Sep 1st 2010, 12:48
What I CANNOT UNDERSTAND is how so many shares were sold two weeks ago till today, forcing the price of Go shares to go down to the level they are now. Did they know beforehand????? Is there any entity that investigates such matters?
Sergio Caruana
Sep 1st 2010, 16:51
Adrian Gouder insider information seems plausible.
A. Borg
Sep 1st 2010, 12:02
Min jaf kemm giethom biex hadu l-football Ingliz u Taljan. X'ma jkunx hemm telf!
J Spearing
Sep 1st 2010, 14:26
Sew qed tghid...u s'issa mhux qed joffru xi servizz mil-aqwa ax id-darbtejn li mort il-kazin nara it-Tottenham, id-darbtejn bdiet tehel u taqta!...u issa bdew il-GO Stars wkoll, avolja ma nahsibx li qed jiswihom hafna ghax films antiki li xebghu fuq l-xkafef tad-DVDs qed juru!
Portelli James
Sep 1st 2010, 11:54
I cannot for the life of me understand why / how:
1) A company that has been in operation for decades selling something as intangible as 'time' can incur a net loss;
2) A strong technical profit translates into a net loss!! Some serious explaining is required vis-a-vis indirect costs (particularly the extraordinary 'one off' items);
3) Is there a hidden agenda by the current board to deflate profits (notwithstanding strong revenue and technical earnings) in order to avoid tax while still siphoning income to or subsidizing costs of significant shareholder/s as indirect costs in GO's P&L?
Christian Vella
Sep 3rd 2010, 13:58
At the moment GO is in a transitional moment, they've in the end of completing a major network upgrade mainly ADSL 2+ connections with a line length of under 2km to an exchange from all the major areas in Malta. This is part of the one of items mentioned + the rights of the premier league and serie a are included in those costs, you know these are bought for 2 years hence the fruit of this investment will be issued in the next few years. A loss was expected but in the near future it will all turn around.
Jon Attard
Sep 1st 2010, 11:16
@R.Mallia
The MCA and the MITC have some very serious explanations to give to the public. How is it that with Malta's urban geography operators such as GO still charge the highest prices in the EU when their EU counterparts charge a fraction and have a higher cost base due to rural infrastructure investments that do not generate as much revenue?
and please don't give us the crap of core networks investment costs, because the core network also has to be scoped with the demand that the network has to cater for.
R. Mallia
Sep 1st 2010, 10:50
...so that explains the highest call rate per min in Europe!!!!
Fenech MD
Sep 1st 2010, 11:19
... and so that explains why persons with a disability registered with KNPD were not given their annual subsidy this year on mobile phones.
N. Pace
Sep 1st 2010, 12:03
this island thrives on subsidies!
Fenech MD
Sep 1st 2010, 13:26
@N Pace
Tridx tiehu s-sussidju u d-dizabbilta li ghandi?
Hadd ma gieghel lil GO tissusidjana, kienet inizjattiva tal-Kumpanija li lilha ma tiswiliex hafna flus, imma lilna tghinna hafna.
P. Gauci
Sep 3rd 2010, 09:28
@Fenech MD
"Hadd ma gieghel lil GO tissusidjana,"
So why are you making a fuss that they stopped the subsidy?