“cloud & fiber” growth strategy shows initial successes in Q3

 

• Sales: € 78.2 million (previous year: € 69.0 million)
• Gross profit: € 24.1 million (previous year: € 22.5 million)
• Operating EBITDA: € 7.0 million (previous year: € 6.8 million),
• Consolidated net income: € 7.1 million (previous year: € 15.3 million)

Düsseldorf, 7 November 2023

The growth strategy announced at the start of the year for the “ecotel Business Customers” segment boosted sales in the third quarter of 2023, resulting in a € 0.2 million increase to € 11.6 million (previous year: € 11.4 million). Sales in this segment also rose slightly in the nine-month comparison period to € 34.2 million (previous year: € 34.1 million). The “ecotel Wholesale” segment saw a significant upturn in the third quarter to € 15.0 million (previous year: € 12.8 million), coming to € 44.0 million for the first nine months of 2023 (previous year: € 34.9 million)

Thanks to the successful expansion of sales activities and the successful positioning in “cloud & fiber”, the Management Board expects sales in the “ecotel Business Customers” segment to rise steadily in the next few quarters too. For example, ecotel secured two additional major contracts in the “fiber” product segment in the third quarter and commenced operations of around 400 additional leased lines in the first nine months. The share of modern SD-WAN connections also picked up considerably. The “cloud” product segment also performed well during the year, contributing to the higher sales and gross profit. Sales performance in this product segment more than doubled year on year.

Gross profit in the “ecotel Business Customers” segment saw a disproportionate increase compared to sales, rising by € 1.3 million to € 22.8 million. This was driven largely by higher value added, positive purchase price developments and the new product mix. Gross profit in the “ecotel Wholesale” segment also improved and rose by € 0.3 million to € 1.3 million thanks to the significant sales growth.

Operating EBITDA saw a € 0.2 million increase to € 7.0 million in the first nine months, despite the planned investment in our growth strategy. At € 1.7 million (previous year: € 2.2 million), operating EBITDA was down year on year in the third quarter. However, Q3 of the previous year saw income of € 0.4 million from the sale of online resources, which affects the annual comparison. Unadjusted EBITDA after nine months came to € 10.9 million (previous year: € 21.7 million).

After accounting for depreciation and amortisation (€ -3.7 million), net finance costs (€ +0.4 million), taxes (€ -2.3 million) and net income from discontinued operations (€ +1.8 million), consolidated net profit of € 7.1 million was generated in the first nine months of 2023 (previous year: € 15.3 million). This translates into earnings per share of € 2.03 (previous year: € 4.36).

A more specified forecast has been issued for 2023 as a whole in view of developments in the first nine months of 2023 and the current forecast for the year as a whole. The Management Board now assumes that sales in the “ecotel Business Customers” segment will be at the lower end of the expected range of between € 46 million and € 48 million, while sales in the “ecotel Wholesale” segment are expected to be at the upper end of the € 48 million to € 52 million range or potentially even higher. Following the positive impact growth investments had on key figures in the first three quarters, targeted investments in further growth will continue in the fourth quarter. Accordingly, the Management Board anticipates operating EBITDA of around € 9 million, at the lower end of the € 9 million to € 10 million range forecast.


 

(in € million) *	2022 9M	2023 9M	2023 forecast
Consolidated sales	69.0	78.2	95–100
thereof ecotel Business Customers segment	34.1	34.2	46–48
thereof ecotel Wholesale segment	34.9	44.0
Gross profit	22.5	24.1	31–33
thereof ecotel Business Customers segment	21.5	22.8
thereof ecotel Wholesale segment	1.0	1.3
Operating EBITDA **	6.8	7.0	9–10
thereof ecotel Business Customers segment	6.4	6.2	> 8.5
thereof ecotel Wholesale segment	0.5	0.8
Consolidated net profit	15.3	7.1	> 4
Earnings per share (in €)	4.36	2.03

 

(in € million) *	2022 Q3	2023 Q3
Consolidated sales	24.2	26.6
thereof ecotel Business Customers segment	11.4	11.6
thereof ecotel Wholesale segment	12.8	15.0
Gross profit	7.4	7.9
thereof ecotel Business Customers segment	7.0	7.5
thereof ecotel Wholesale segment	0.4	0.5
Operating EBITDA **	2.2	1.7
thereof ecotel Business Customers segment	2.0	1.4
thereof ecotel Wholesale segment	0.2	0.3
Consolidated net profit	1.5	0.4
Earnings per share (in €)	0.42	0.12

* Prior year figures restated; differences in the totals may occur due to rounding.
** For definition see Group Management Report on page 52 of the 2022 annual report

About ecotel communication ag:
ecotel communication ag has been operating throughout Germany since 1998 and has established itself as one of the leading quality providers for business customers. With its focus on “cloud & fibre” in 2022, ecotel serves the two most important growth areas on the German telecommunications market. The company is headquartered in Düsseldorf. ecotel currently has around 225 employees across Germany and provides a full service package of cloud and broadband services for more than 15,000 customers.
Note:
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Investor Relations

ecotel communication ag
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E-mail: investorrelations@ecotel.de

Further information can be found online at www.ecotel.de