Hugin Ad hoc announcement according to § 15 WpHG: Interim report: mobilcom AG: mobilcom shows strong customer growth and confirms forecasts

Tuesday, 08. November 2005 08:17

The mobilcom Group has increased its emphasis on growth in new
customers, but has kept an eye on its profitability. During the first
nine months, mobilcom was able to increase sales by 5.7% to €1.49
billion. Gross profit rose by more than 16% from €328.7 million
(Q1-Q3/2004) to €383.8 (Q1-Q3/2005). Despite the high one-time
expenses of €18,4 million, the EBITDA rose in the first 9 months from
€138.0 million to €146.2 million. The EBIT improved by 18.4% to
€104.9 million. The EBITDA, adjusted for the one-time expenses of
€18.4 million, rose by 11.8% to €55.7 million in Q3/2005. The
adjusted EBIT improved by 26.5% to €42.6 million in Q3/2005 (Q3/2004:
€33.7 million)2.

Mobile Serviceprovider: strong growth in new customers
For the first time in this year, mobilcom registered a substantial
increase in new customers. The service provider gained 0.1 million
new customers in the 3rd quarter. This was not possible without
increased efforts: with a gross of 412,000 new customers, mobilcom
had to acquire more than 100,000 more customers than in the previous
quarter. It was also possible to increase significantly the sale of
freenet.de DSL products in the 3rd quarter following the change on
the mobilcom Management Board. The DSL product from freenet.de is not
only an ideal complement and additional earning potential for all
mobilcom sales channels, it will also contribute to the strong DSL
growth of freenet.de AG in Q4/2005.
Turnover in the 3rd quarter of 2005 fell slightly in comparison with
the same quarter last year due to the weakening of new business and a
lower ARPU (average monthly turnover per customer). However, in
comparison with the previous quarters the service provider was able
to improve turnover further: due to the seasonal rise in ARPU in the
contract customer segment and the customer growth in comparison with
the 2nd quarter of 2005, turnover rose by app. 5% to €348.2 million.
Despite the strong new business, the EBITDA, when adjusted for the
one-time expenses (€6.7 million) related to the merger, improved by
125.4% to €23.2 million (Q3/2004: €10.3 million)2 and the EBIT by
355.5% to €19.2 million (Q3/2004: €4.2 million)2. Taking into account
the one-time expenses of €6.7 million, the EBITDA amounted to €16.5
million and the EBIT to €12.5 million for the 3rd quarter of 2005.

klarmobil.de successfully placed on the discount market
The wireless services market was characterized in the last quarter by
the increase of low-priced providers in the discount segment which
has had a strong effect on the competition for mobile services.
mobilcom has acknowledged this development by adding its own wireless
services discount brand klarmobil.de and has been serving the "no
frills" customer segment since the middle of September. During the
4th quarter, the sales of klarmobil.de will be supported by a
marketing campaign in online, print and TV media.

Fixed Line/Internet: accelerating rate of growth in DSL
In the 3rd quarter of 2005, freenet.de realized a new record turnover
in the business unit Fixed Line/Internet of €185.6 million - a plus
of 60.6% in comparison with the same quarter of the previous year.
Gross profits also rose further to €78.2 million, corresponding to a
gross profit margin of just under 42%. Despite the growth strategy
which has been pursued in a field in which competition is increasing,
rates for online and telephone services are falling and margins have
been reduced, freenet.de continues to operate profitably. This is
documented by the EBITDA of €32.5 million in the 3rd quarter of 2005
before deduction of the one-time expenses (€11.7 million) resulting
from the merger and the related handling of the stock options of the
freenet.de employees and executive board. Taking into account the
one-time expenses, the business unit Fixed Line/Internet had the
following results in the 3rd quarter of 2005: EBITDA of €20.8 million
and an EBIT of €11.7 million.
freenet.de continued to push its growth in DSL business with its
strong earnings by adding 80 thousand new customers to its existing
clientele of 605 thousand. The number of telephony customers rose -
thanks to a strong plus in call-by-call customers - in comparison
with the 3rd quarter of 2004 from 3.62 million to 5.33 million (0.5
million thereof in pre-selection).

Liquidity secures strategic position on the telecommunications market
mobilcom has liquidity reserves of €405.6 million. The development of
liquid assets over the course of the year, from €338.2 million
(Q1/2005) to €405.6 million (Q3/2005), shows that the mobilcom Group
has more than compensated for the expenditures related to the
freenet.de acquisitions of app. €90m in 2005. "The Group is very well
prepared to take an active part in the necessary consolidation of the
German telecommunications market and thereby to secure a
future-oriented strategic position," says Eckhard Spoerr, CEO of
mobilcom AG.

Looking ahead: mobilcom confirms growth target
Supported by the recognizable success in new customer business,
mobilcom has confirmed its target of growing to 4.8 million customers
by the end of the business year. The EBITDA of the service provider
in the 4th quarter will be burdened, as in previous years, by
increased efforts for the acquisition of new customers and higher
marketing expenditures. Currently a best practice comparison with
freenet.de AG is being prepared in the Mobile Serviceprovider unit to
identify additional earnings potential in mobile services business.
The Management Board expects an EBITDA of €66 million (2004: €40.1
million)2 before the one-time expenses caused by the merger for the
Mobile Serviceprovider in business year 2005. For Fixed Line/Internet
business, mobilcom is assuming an EBITDA of €125 million to €140
million before one-time expenses caused by the merger in business
year 2005. The EBITDA for the Group thus remains in the upper half of
the previous range (€185 million - €200 million before expenses
caused by the merger) of the earnings forecast.
Significant operating figures for the mobilcom Group in Period and
quarterly comparison:
Accounting methods: IFRS

+-----------------------------------------------------------------------------+
| | Q3/ | Q3/ | Q1-Q3 | Q1-Q3 |Q3/ | Q1-Q3 |
| | 20051 |20042| 20051 | 20042 |2005 | 2005 |
|---------------------------+----------+-----+----------+-------+-----+-------|
|Employees | 3,585|2,970| 3,585| 2,970|3,585| 3,585|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Turnover in €m | 531.8|477.5| 1,492.0|1,411.8|531.8|1,492.0|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Service provider | 350.2|361.9| 995.4| 1067.7|350.2| 995.4|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Fixed Line/Internet | 185.6|115.6| 509.7| 344.0|185.6| 509.7|
|---------------------------+----------+-----+----------+-------+-----+-------|
|EBITDA in €m | 55.7| 49.8| 164.6| 138.0| 37.3| 146.2|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Service provider | 23.2| 10.3| 63.7| 40.5| 16.5| 57.0|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Fixed Line/Internet | 32.5| 39.5| 100.9| 97.5| 20.8| 89.2|
|---------------------------+----------+-----+----------+-------+-----+-------|
|EBIT in €m | 42.6| 33.7| 123.3| 88.6| 24.2| 104.9|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Service provider | 19.2| 4.2| 52.5| 21.6| 12.5| 45.8|
|---------------------------+----------+-----+----------+-------+-----+-------|
|Fixed Line/Internet | 23.4| 29.5| 70.7| 67.1| 11.7| 59.0|
|---------------------------+----------+-----+----------+-------+-----+-------|
| | no | | no | | | |
|EBT in €m |adjustment| 36.1|adjustment| 94.1| 26.4| 110.8|
| | (26.4) | | (110.8) | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
| | no | | no | | | |
|Group result in €m |adjustment| 23.1|adjustment| 55.9| 16.0| 69.6|
| | (16.0) | | (69.6) | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
| | no | | no | | | |
|Result/share in € |adjustment| 0.21|adjustment| 0.57| 0.20| 0.82|
| | (0.20) | | (0.82) | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
|Mobile customers in | 4.65| 4.33| 4.65| 4.33| 4.65| 4.65|
|millions | | | | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
|thereof contract customers | 2.54| 2.32| 2.54| 2.32| 2.54| 2.54|
|in millions | | | | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
|thereof prepaid customersin| 2.12| 2.02| 2.12| 2.02| 2.12| 2.12|
|millions | | | | | | |
|---------------------------+----------+-----+----------+-------+-----+-------|
|DSL customers | 605| 265| 605| 265| 605| 605|
+-----------------------------------------------------------------------------+

1Adjusted for one-time expenses of €18.4 million (thereof €6.7
million in the segment Mobile Serviceprovider and €11.7 million in
the segment Fixed Line/Internet)
2Adjusted in accordance with IAS 1 and IFRS 2.

--- End of Ad-hoc Message ---
WKN: 662240; ISIN: DE0006622400; Index: CDAX, HDAX, Prime All Share,
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Related Links: MobilCom AG
Author:
Hugin
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