THE BOARD OF DIRECTORS APPROVED THE DRAFT FINANCIAL STATEMENTS FOR THE YEAR ENDED AS AT 31 DECEMBER 2018

Transcription

1 Press release THE BOARD OF DIRECTORS APPROVED THE DRAFT FINANCIAL STATEMENTS FOR THE YEAR ENDED AS AT 31 DECEMBER 2018 VALUE OF PRODUCTION, +21% TO 17.9 MILLION EBITDA +19.5% TO 6.8 MILLION: EBITDA TARGET ( 6.5 MILLION) SET FORTH BY THE PRICE ADJUSTMENT SHARE MECHANISM SURPASSED NET PROFIT +26.4% TO 3.2 MILLION DIVIDEND OF 0.02 PER SHARE PROPOSED THE FIBRE OPTIC NETWORK TOUCHES 2,000 KM, +30% ON AN ANNUAL BASIS Value of production at 17.9 million, +21% YoY thanks to significant growth in FTTC and FTTH ultra broadband connections (+65% YoY); EBITDA 1 at 6.8 million, % (EBITDA margin at 38.7%); EBITDA net of the accounting effects of listing equal to 7.3 million, higher than the EBITDA target of 6.5 million set out in the Price Adjustment Share mechanism established at the time of listing; adjusted EBITDA margin at 41.7%; EBIT at 4.2 million, % (EBITDA margin at 23.4%); Net profit at 3.2 million, +26.4%; Positive (cash) Net Financial Position (NFP) of 6.6 million compared to a negative NFP of 4.1 million as at 31 December 2017 thanks to the increase in share capital in service of the listing and significant cash generation; Investments of 6.5 million concentrated on development of the network, which increased from 1,700 Km to 1,950 Km in 2018, marking growth of 30% on an annual basis. 1 EBITDA: Alternative performance indicator: EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation Gross Operating Profit) is an alternative performance indicator not defined by Italian accounting standards but used by company management to monitor and evaluate the company s operating performance, as it is not influenced by volatility due to the effects of the different criteria for calculating taxable income, the amount and the characteristics of capital employed as well as the relevant depreciation/amortisation policies. This indicator is defined by Intred as Profit/(Loss) for the period before amortisation/depreciation and write-downs of tangible and intangible fixed assets, financial income and charges and income taxes. Intred S.p.A. Via Pietro Tamburini, Brescia info@intred.it VAT no Tax Code&Register of Companies no REA BS Share capital 10,000, fully paid-up

2 Milan, 19 March 2019 The Board of Directors of Intred S.p.A. ( Company or Intred ), a telecommunications operator listed on the Borsa Italiana AIM Italia market since 2018 (symbol: ITD.MI) with a significant presence in Lombardy, specialised in the connectivity of ultra-broadband networks, broadband, wireless, fixed telephone, cloud services and related accessories, for Business and Retail customers, met on today s date under the Chairmanship of Daniele Peli, and examined and approved the draft financial statements for the year ended as at 31 December 2018, drafted in accordance with the AIM Italia Issuer s Regulation and in compliance with the Italian accounting standards. Daniele Peli, Co-Founder and Chief Executive Officer of Intred S.p.A., commented: This year saw the company post record results, with significant growth in the main economic-financial ratios. We are especially satisfied with the profit margins obtained, better than the whole of 2017 and the target set by the Company at the time of listing. In fact, we achieved an EBITDA of 7.3 million net of the accounting effects of the listing (EBITDA margin of 41.7%), higher than the 6.5 million indicated as the threshold above which the Price Adjustment Share mechanism would be triggered. The achievement of these excellent results was made possible despite the continuation, at the same time, of significant investments in development of the fibre optic access network, accounting for more than 35% of our turnover. The results of the first few months of the current year and the strategic agreements signed recently with TIM and Open Fiber, give us confidence that we can continue to record growth this year with respect to the one just ended. RECLASSIFIED INCOME STATEMENT The reclassified income statement is shown below, compared with 2017, and with the normalised situation before the accounting effects of the listing. The normalised situation does not consider the revenue deriving from the presentation of the application to use the listing tax credit of 416 thousand and the costs incurred in relation to the AIM market listing project, both prior to the admission and trading phase, and relating to the subsequent phase of continued presence on the market for a total of 888 thousand. Therefore, we posted an adjusted EBITDA of 7.3 million, growth of around 1.6 million compared to the previous year (+27.8%); with an EBITDA margin, which rose considerably, up from 38.5% in 2017 to 41.7% (adjusted) in INCOME STATEMENT 31/12/2018 % 31/12/2018 Normalised % 31/12/2017 % Revenues from sales 17,201, % 17,201, % 14,401, % Other revenues 681, % 265, % 375, % Value of production 17,883, % 17,467, % 14,776, % Raw materials 122, % 122, % 310, % Services 3,357, % 2,468, % 2,252, % Use of third party assets 4,661, % 4,661, % 3,698, % Sundry operating charges 345, % 345, % 490, % Total costs 8,486, % 7,597, % 6,753, % Value added 9,397, % 9,869, % 8,023, % Personnel costs 2,590, % 2,590, % 2,327, % EBITDA 6,806, % 7,279, % 5,696, % Amortisation, depreciation and writedowns 2,616, % 2,616, % 2,172, % EBIT 4,190, % 4,662, % 3,524, % Financial income and expenses 31, % 31, % 54, % EBT 4,158, % 4,630, % 3,469, % Page 2

3 MAIN ECONOMIC-FINANCIAL RESULTS AS AT 31 DECEMBER 2018 The value of production in 2018 amounted to 17.9 million, marking growth of 21% compared to the same period in the previous year. The increase in revenues continues to be driven by the sales of fast ultra-broadband connections (FTTH and FTTC), up by 65% to 8.0 million. The telephone sector also improved (+12% to 2.0 million), sustained by sales of flat type sales packages. Revenues from data centre services (Housing and Cloud) and accessories were in line with the previous year, while the decrease in the RDSL sector (-5%) and traditional broadband services based on copper cable connectivity (-7%), is the result of the company s strategy of offering incentives to its customers to move to ultra-broadband fibre optic connections. A total of 95.4% of revenues derives from recurring fees, which ensure the company with continuity and clear visibility of future forecasts. The distribution of turnover by customer type remained essentially stable with respect to previous periods, with significant growth in sales to the Wholesale market (+31% to 2.3 million, equal to 13% of 2018 turnover), thanks to the increase in FTTH connections for some national operators, the residential sector through the EIR brand name (+25% to 4.9 million, equal to 29% of turnover), the Public Administration (+29% to 0.7 million, accounting for 4% of turnover) and the business sector (+14% to 9.2 million, equal to 54% of turnover). In 2018, the number of users with data lines rose significantly, from 21,937 at 31 December 2017 to 26,268 at 31 December 2018, marking growth of 20.3%, accelerating in the final quarter of the year. The churn rate on turnover stands at 3.5%, essentially in line with the figure of the previous year Reclassified YoY 3 /million % of /million % of /millio % of Revenues Revenues n Revenues Business % % % +14 % Residential % % % +25 % Wholesale 2 14% % % +31 % P.A. (Public administration ) % 0.6 4% 0.7 4% +29 % Total % % % 20% revenues were re-allocated by service line to make the comparison with the figure of the current year consistent, although the effect on the percentage composition of turnover is negligible. 3 The percentage increases refer to the reclassified 2017 figure. Page 3

4 The Gross Operating Profit (EBITDA) realised in 2018 came to 6.8 million, with a EBITDA margin of 38.1% (as at 31/12/2017 it was 38.5%). EBITDA includes the revenue deriving from the listing tax credit of 416 thousand and the costs incurred in relation to the AIM market listing project, both prior to the admission and trading phase, and relating to the subsequent phase of presence on the market for a total of 888 thousand. The operating result (EBIT) was a positive 4.2 million, with an EBIT margin of 23.4% (as at 31/12/2017 it was 23.9%). Net profit stood at 3.2 million in 2018, growth of 26.4%. The Company, confident in its profit-making ability, was committed to reaching, at the time of the IPO, a 2018 EBITDA target of 6.5 million, net of the effects of the listing process; in the event the failure to hit the above-mentioned target, the PAS (Price Adjustment Share) mechanism made provision for the gradual cancellation of up to 15.6% of the shares held by historic shareholders; the excellent performance in the year should be noted, with the company not only fully meeting the target set but surpassing it. RECLASSIFIED BALANCE SHEET BALANCE SHEET 2018 % 2017 % Abs. val. Change % Trade receivables 3,096, % 3,581, % -484, % Other assets 1,015, % 1,127, % -111, % Accruals and deferrals 343, % 497, % -153, % CURRENT ASSETS 4,456, % 5,206, % -750, % Trade-related payables -5,061, % -4,486, % -574, % Payments on account -3, % -1, % -1, % Tax position 269, % -362, % 631, % Accruals and deferrals -4,477, % -4,124, % -353, % Other liabilities -507, % -426, % -80, % CURRENT LIABILITIES -9,780, % -9,401, % -378, % NET WORKING CAPITAL -5,323, % -4,194, % -1,129, % Intangible fixed assets 4,856, % 3,735, % 1,121, % Tangible fixed assets 16,990, % 14,379, % 2,611, % Financial fixed assets 114, % 99, % 14, % TOTAL FIXED ASSETS 21,962, % 18,214, % 3,748, % Employee severance indemnity -552, % -477, % -75, % Provisions for risks and charges -22, % -25, % 3, % NET INVESTED CAPITAL 16,063, % 13,515, % 2,547, % Share capital -10,000, % -3,810, % -6,190, % Reserves -9,441, % -3,091, % -6,350, % Result for the year -3,208, % -2,537, % -671, % SHAREHOLDERS EQUITY -22,650, % -9,439, % -13,211, % Immediate liquidity 9,651, % 1,087, % 8,563, % Payables due to banks - within 12 months -1,252, % -1,906, % 653, % Payables due to banks - after 12 months -1,811, % -3,258, % 1,446, % NET FINANCIAL POSITION 6,586, % -4,076, % 10,663, % Page 4

5 The net financial position was a positive (cash) 6.6 million, significant growth compared to the negative NPF of 4.1 million at 31 December 2017, thanks to the increase in share capital in service of the listing amounting to 9.5 million (net of listing costs and excluding Greenshoe option) and high cash generation equal to 5.82 million (+19.8% compared to the previous year). Cash and cash equivalents totalled 9.6 million compared to 1.1 million as at 31 December Medium and long-term payables to banks amounted to 3.1 million compared to 5.2 million at 31 December Shareholders equity as at 31 December 2018 came to 23.6 million, an increase compared to 9.4 million as at 31 December Shareholders equity does not take into account the effects of the IPO finalised in July, which raised funding of approximately 9.5 million (net of listing costs and excluding Greenshoe option). Investments and network development Investments in 2018 totalled 6.5 million, concentrated essentially on the development of the fibre optic access network (FTTH and FTTC mode), predominantly in the provinces of Brescia, Bergamo and Mantua. As at 31 December 2019, the company boasted a fibre optic network stretching 1,950 Km, an increase of 30% compared to 1,700 Km at the end of 2017, 130 exchanges and 470 street cabinets distributed throughout the provinces of Brescia, Bergamo and Mantua. The network infrastructure converges on two ISO certified data centres connected to the main national/international carriers and the to the Milan Mix, which house the networking equipment of Cisco Systems and Huawei, that manage the provision of connectivity to more than 26,000 data users. The bulk of the investments in INTRED s network infrastructure was in tangible fixed assets (73.4% of the total), relating to the development of the network, with the remainder (23.6% of the total) relating to intangible fixed assets, composed primarily of acquisitions of rights of use, in IRU (Indefeasible Right of Use ) mode for a duration of 15 years, for dark fibre and/or cables. MAIN SIGNIFICANT EVENTS IN 2018 **** On 18 July, Intred S.p.A. commenced the trading of ordinary shares on AIM Italia, the Alternative Capital Market organised and managed by Borsa Italiana S.p.A.. The price of placement of the ordinary shares was set at 2.27, with a company capitalisation at the date of start of trading of roughly 36.0 million (including PAS shares) and a free float of 18.6% of the company s share capital (21.4% assuming the full exercise of the Greenshoe option). On 17 August, Intred S.p.A announced that Banca Profilo S.p.A. had exercised the Greenshoe Option for a total of 440,500 shares owned by Daniele Peli and Marisa Prati (the Shareholders ). The purchase price of the shares forming the object of the Option was 2.27 per share, corresponding to the price established as part of the Global Offer - for a total value of 999,935. The Ordinary Shareholders Meeting of Intred S.p.A. was held on 18 September, which approved the proposal to increase the number of members of the Board of Directors from 4 to 5. The shareholders meeting appointed Renzo Torchiani as new Board member, representing the shareholder Value First SICAF S.p.A. (subsidiary of First Capital S.p.A.), determining the associated fee. Page 5

6 On 6 November, Intred S.p.A. announced that it had signed a significant agreement with Telecom Italia S.p.A. for the acquisition of the right of use (IRU) for a duration of 15 years, for approximately 500 Km of dark fibre. This operation, for a total of 3 million, allowed Intred to develop its network in 90 municipalities in Lombardy, with significant repercussions on sales of fibre optic connectivity in the provinces of Milan, Monza and Brianza, Lecco and Bergamo. MAIN SIGNIFICANT EVENTS AFTER THE CLOSE OF THE PERIOD Intred S.p.A. signed an important agreement on 19 February 2019 with Open Fiber for use of the GPON dark fibre network. The operation, with a total of investment of 3 million over 5 years, will allow Intred to increase sales of FTTH connections, to a potential of 70,000 property units in the city of Brescia, greatly boosting sales in the urban areas of the most important cities in Lombardy. BUSINESS OUTLOOK FOR THE CURRENT YEAR **** The results of the first few months of the offer give signs of positive prospects, also in consideration of the strategic agreements signed with TIM and Open Fiber and, however, as confirmed by the increase in volumes of turnover and the growth in the economic indicators. The increase in revenues in 2019 will be driven by sales of ultra-broadband services and the EIR residential segment, also continuing with the process of transferring users from broadband connections to fibre optic connections, with greater customer satisfaction and growing profitability for the company. The constant growth in the number of customers and good visibility regarding recurring revenues gives us confidence as regards achieving improved results compared to the year just ended. DIVIDEND PROPOSAL **** The Board of Directors will propose to the Shareholders Meeting the distribution of an ordinary dividend from 2018 profits, before legal withholding taxes, of 0.02 per share, for a total amount of 317,010, with coupon detachment on 6 May 2019 and payment on 8 May Those who are Intred S.p.A. shareholders at the end of the accounting day on 7 May 2019 (record date) will be entitled to dividends. CALLING OF ORDINARY SHAREHOLDERS MEETING The Board of Directors resolved to call the Ordinary Shareholders Meeting for 19 April 2019, on dual call, the first official one set for 09:00 and the second on 20 April 2019 at 9:00 at the company s headquarters in Brescia, in via Pietro Tamburini 1, to discuss and resolve on the following agenda: Approval of the financial statements as at and allocation of profit for the year; Renewal of the Board of Statutory Auditors for the three-year period Page 6

7 FINANCIAL CALENDAR Intred S.p.A. s Board of Directors also announces the addition to the financial calendar, for the 2019 quarterly turnover figures, according to the following timetable: Monday 06/05/2019: Board of Director s approval of the results of the first quarter of 2019 Friday 02/08/2019: Approval by the Board of Directors of the results of the first half of 2019 Tuesday 05/11/2019: Board of Director s approval of the results of the third quarter of 2019 FILING OF DOCUMENTATION The call notice and the relevant documentation required by the applicable legislation, including therein the draft financial statements as at 31 December 2018, the report on operations, the reports of the directors on the items on the agenda of the shareholders meeting, the report of the Board of Statutory Auditors, the independent auditors report, the report on corporate governance and ownership structures and the remuneration report, will be available to the public, according to the legal terms, at the company headquarters (via Pietro Tamburini, 1, Brescia) as well as through publication on the institutional website Investors/Financial Statements and Reports section and on the authorised storage mechanism 1INFO ( Please note that the audit of the draft financial statements has still not been finalised and that the independent auditors report will therefore be made available according to the legal terms. Lastly, it should be noted that the attached income statement and the balance sheet represent reclassified tables and, as such, are not verified by the auditors. This press release is available in the investors section of the website Intred Telecomunicazioni A reference telecommunications operator in Lombardy, established in 1996 by Daniele Peli, current company President and Chief Executive Officer, listed on the AIM Italia of Borsa Italiana since 2018 (symbol: ITD.MI). With a fibre optic network stretching more than 1,950 Km, 130 POP two Data Centres, a wireless network with 42 radio stations and a national telephone network, Intred provides ultra-broadband connectivity, broadband, wireless, fixed telephony, cloud services plus accessory services for Business and Retail customers, the latter served by the EIR brand. The direct management of infrastructures facilitates service efficiency, profitability and quality and, thanks to a dedicated internal call centre, allows a guaranteed and extremely high level of assistance for its users, which has helped the company reach a customer satisfaction index of 93.6%. High value assets, a consolidated and highly scalable business model, with a value of production of 17.9 million in 2018, make Intred the ideal infrastructural technological partner, with a comprehensive range of quality, reliable and secure solutions. Nomad Integrae SIM S.p.A. 02/ info@integraesim.it Investor Relations Intred CFO & Investor Relations Officer Filippo Leone Tel ir@intred.it Media Relations CDR Communication Angelo Brunello Tel angelo.brunello@cdr-communication.it CDR Communication Vincenza Colucci Tel vincenza.colucci@cdr-communication.it Page 7

8 INCOME STATEMENT INCOME STATEMENT 2018 % 2017 % Abs. val. Change % Value of production 17,883, % 14,776, % 3,106, % Revenues from sales 17,201, % 14,401, % 2,800, % Other revenues and income 681, % 375, % 306, % External costs 8,486, % 6,753, % 1,732, % Purchase of assets 122, % 310, % -188, % Provision of services 3,357, % 2,252, % 1,104, % Use of third party assets 4,661, % 3,698, % 962, % Operating expenses 345, % 490, % -145, % VALUE ADDED 9,397, % 8,023, % 1,373, % Personnel costs 2,590, % 2,327, % 263, % GROSS OPERATING PROFIT 6,806, % 5,696, % 1,110, % Amortisation, depreciation and write-downs 2,616, % 2,172, % 444, % COMPANY OPERATING PROFIT 4,190, % 3,524, % 665, % Balance of financial management -31, % -53, % 21, % Financial income 44, % 47, % -3, % Financial expenses -75, % -101, % 25, % Adjustments to financial assets % % % PRE-TAX PROFIT 4,158, % 3,469, % 688, % Taxes -949, % -939, % -10, % NET PROFIT 3,208, % 2,537, % 671, % Page 8

9 BALANCE SHEET BALANCE SHEET 2018 % 2017 % Abs. val. Change % Trade receivables 3,096, % 3,581, % -484, % Other assets 1,015, % 1,127, % -111, % Accruals and deferrals 343, % 497, % -153, % CURRENT ASSETS 4,456, % 5,206, % -750, % Trade-related payables -5,061, % -4,486, % -574, % Payments on account -3, % -1, % -1, % Tax position 269, % -362, % 631, % Accruals and deferrals -4,477, % -4,124, % -353, % Other liabilities -507, % -426, % -80, % CURRENT LIABILITIES -9,780, % -9,401, % -378, % NET WORKING CAPITAL -5,323, % -4,194, % -1,129, % Intangible fixed assets 4,856, % 3,735, % 1,121, % Tangible fixed assets 16,990, % 14,379, % 2,611, % Financial fixed assets 114, % 99, % 14, % TOTAL FIXED ASSETS 21,962, % 18,214, % 3,748, % Employee severance indemnity -552, % -477, % -75, % Provisions for risks and charges -22, % -25, % 3, % NET INVESTED CAPITAL 16,063, % 13,515, % 2,547, % Share capital -10,000, % -3,810, % -6,190, % Reserves -9,441, % -3,091, % -6,350, % Result for the year -3,208, % -2,537, % -671, % SHAREHOLDERS EQUITY -22,650, % -9,439, % -13,211, % Immediate liquidity 9,651, % 1,087, % 8,563, % Payables due to banks - within 12 months -1,252, % -1,906, % 653, % Payables due to banks - after 12 months -1,811, % -3,258, % 1,446, % NET FINANCIAL POSITION 6,586, % -4,076, % 10,663, % Page 9

10 STATEMENT OF CASH FLOWS Amount as at 31/12/2018 Amount as at 31/12/2017 A) Cash flows from operating activities (indirect method) Profit (loss) for the year 3,208,734 2,537,708 Income taxes 949, ,093 Interest expense/(income) 31, ) Profit (loss) for the year before income taxes, interest, dividends and capital gains/losses from disposal 4,189,961 3,523,373 Adjustments for non-monetary elements that do not have a contra-entry in net working capital Allocations to provisions 347 Amortisation/depreciation of fixed assets 2,616,628 2,172,077 Other upward/(downward) adjustments for non-monetary elements 119,038 99,212 Total adjustments for non-monetary elements that do not have a contra-entry in net working capital 2,735,666 2,271,636 2) Cash flow before changes in net working capital 6,925,627 5,795,009 Changes in net working capital Decrease/(increase) in receivables due from customers 484,828 (393,466) Increase/(decrease) in trade payables 574, ,203 Decrease/(increase) in accrued income and prepaid expenses 153,417 (126,864) Increase/(decrease) in accrued expenses and deferred income 352,735 30,557 Other decreases/(other increases) in net working capital (437,087) (1,010,489) Total changes in net working capital 1,128,522 (852,059) 3) Cash flow after changes in net working capital 8,054,149 4,942,950 Other adjustments Interest collected/(paid) (31,691) (53,572) (Income taxes paid) (949,536) (932,093) (Use of provisions) (291) Other collections/(payments) (43,717) (52,790) Total other adjustments (1,025,235) (1,038,455) Cash from operating activities (A) 7,028,914 3,904,495 B) Cash flows from investment activities Tangible fixed assets (Investments) (4,767,584) (4,367,988) Intangible fixed assets (Investments) (1,582,546) (1,135,639) Financial fixed assets Page 10

11 Amount as at 31/12/2018 Amount as at 31/12/2017 (Investments) (15,841) (14,305) Disinvestments 15,664 Cash from investment activities (B) (6,365,971) (5,502,268) C) Cash flows from financing activities Third-party financing Increase/(decrease) in short-term payables to banks (653,738) 291,134 Obtainment of loans 488,522 (Loan repayment) (1,446,680) Equity Paid increase in share capital 10,000,725 Cash from financing activities (C) 7,900, ,656 Increase (decrease) in cash and cash equivalents (A ± B ± C) 8,563,250 ( ) Opening cash and cash equivalents Bank and postal deposits 1,086,844 1,905,439 Cash at hand Total opening cash and cash equivalents 1,087,843 1,905,960 Closing cash and cash equivalents Bank and postal deposits 9,650,300 1,086,844 Cash at hand Total closing cash and cash equivalents 9,651,093 1,087,843 Balancing difference Page 11