Revenue, Profit Before Tax and EBITDA are all down versus H1 16.
Companies: Manx Telecom
Manx Telecom (LON: MANX), the Isle of Man communications provider, has released its Half Year report for H1 17 to negative reactions from the market today with shares down 4% this morning.
Revenue for the Group is slightly down from £39.2m in H1 16 to £38.5m, mainly due to a 32% drop in Data Centre revenue due to "customer consolidation." As expected, fixed line call revenue has also fallen as mobile revenue grows.
EBITDA is also down from £13.8m in H1 16 to £12.6m and Profit Before Tax has dropped from £8.3m to £6.7m in H1 16.
The Group has gone through a period of transition this year, with Group CEO Gary Lamb commenting on the changes:
"First half net debt was affected by the expected exceptional costs associated with the transformation programme, but I am pleased to say that underlying levels of cash flow remain strong and net debt is expected to fall in the second half as these costs reduce. Whilst it remains early days, we are pleased with the impact of the Transformation Programme thus far."
Liberum's note on MANX's results had this to say...
"The customer consolidation-led decline in data centre profits has been well flagged. Despite the recent bounce we believe there is still 20% upside in the equity valuation with the potential for the transformation programme to deliver more strategic options for Management and additional upside for shareholders."
They also reiterated their BUY stance on the stock, while Management said they are trading in line with expectations for the Full Year.
Liberum's forecasts for FY 17 and beyond predict marginal revenue, PBT and EBITDA year-on-year growth.
With a market cap of £225m MANX trades with a PE ratio of 13x versus the industry median of 14x. For the five years to 2016 the Group has operated at a margin of 20%, but revenue and profit growth have seen low single digit growth.
