FOURTH QUARTER 2011
FULL YEAR 2011
London, UNITED KINGDOM – 28 February 2012 – euNetworks Group Limited, announced solid fourth quarter and full year results, with continued growth of the business. Following the successful completion of two acquisitions in Germany and a rights offering, euNetworks is well positioned to take advantage of further opportunities.
The fourth quarter was an important period for integration activities as well as network developments and building connections, supporting growth into 2012. Results announced today for the quarter ended 31 December 2011, include a full quarter of LambdaNet Communications Deutschland GmbH (“LambdaNet”) and TeraGate GmbH (“TeraGate”) financials. Going forward, all reporting will be consolidated to euNetworks.
For the fourth quarter, total revenues grew by 74% year on year, from €13.7m in 4Q 2010 to €23.8m in 4Q 2011. Recurring revenues were €22.3m, up 112% from 4Q 2010. The non-recurring revenues in the quarter reflected the sale of non-core network assets. Overall, network revenues continued to grow, increasing by 83% from 4Q 2010 to €19.0m. Recurring network revenues excluding LambdaNet and TeraGate were up 22% compared to 4Q 2010 and up 8% from 3Q 2011. Gross profit in the quarter increased by 60%, from €9.6m in 4Q 2010 to €15.4m in 4Q 2011. Gross margin declined to 64.7%, down from 70.1% in 4Q 2010, which largely reflected the addition of LambdaNet and TeraGate to the Group. euNetworks is working to improve gross margin through a combination of integration synergies and high margin new sales. On average, new sales across the combined businesses have gross margin of ~80%. Adjusted EBITDA1 was €0.1m, down from €1.8m in 4Q 2010 following €2.6m of one-off restructuring and integration costs from acquisitions. Excluding these one-off items, underlying Adjusted EBITDA was €2.7m in the quarter.
For the full year, total revenues for the Group grew 65%, from €43.8m in 2010 to €72.1m in 2011. Recurring revenues for the year were €68.6m, up 75% from 2010. Network revenues grew by 80% to €54.6m, while recurring network revenues excluding LambdaNet and TeraGate grew 26% to €31.9m in 2011. Gross profit for the year increased by 58% to €49.7m. Gross margin was 69%, down from 72% in 2010. Adjusted EBITDA in 2011 was €5.9m, a significant improvement from €(0.9)m in 2010.
euNetworks is a bandwidth infrastructure company, owning and operating 17 fibre based metropolitan networks connected with a high capacity intercity backbone covering 51 cities in 15 countries. The company leads the market in data centre connectivity, directly connecting over 430 today. euNetworks is also a leading cloud connectivity provider, directly connecting to all key cloud platforms with access to additional platforms. The company offers a targeted portfolio of metropolitan and long haul services including Dark Fibre, Wavelengths, and Ethernet. Wholesale, finance, content, media, data centre and enterprise customers benefit from euNetworks’ unique inventory of fibre and duct based assets that are tailored to fulfil their high bandwidth needs.