Financial highlights Q1 2018
- Síminn‘s revenue amounted to ISK 6,874 million in the first quarter (Q1) of 2018, compared to ISK 6,723 million in the same period 2017. An increase by ISK 151 million or 2.2%.
- EBITDA amounted to ISK 2,231 million in Q1 2018, compared to ISK 2,099 million in the same period of 2017, up by ISK 132 million or 6.3%. The EBITDA ratio was 32.5% in Q1 2018, compared to 31.2% in the same period of 2017.
- Profit in Q1 2018 amounted to ISK 887 million, compared to ISK 774 million in the same period of 2017.
- Cash generated by operation amounted to ISK 2,390 million in Q1 2018, compared to ISK 2,427 million in the same period of 2017. Net cash from operating activities amounted to ISK 2,043 million in Q1 2018, compared to ISK 2,096 million in the same period 2017.
- Interest bearing debt amounted to ISK 17.6 billion at the end of Q1 of 2018, compared to ISK 18.4 billion at the end of 2017. Net interest-bearing debt amounted to 16.8 billion ISK at the end of Q1 2018.
- Net financial expenses amounted to ISK 182 million in Q1 2018, compared to ISK 207 million in the same period of 2017. Financial expenses amounted to ISK 241 million, financial income ISK 52 million, and foreign exchange income ISK 7 million.
- Síminn's equity ratio was 61.4% at the end of Q1 2018 and equity was 37,2 billion.
Orri Hauksson, CEO:
„The year 2018 is off to a good start. Revenues are increasing from last year and operating results are improving. This positive development has many explanations. We are seeing an increase and shift in our customer base towards younger customers, specifically in our mobile service, with increased consumer appreciation of the mobile product, Þrennan. Síminn´s IPTV service is very popular among demanding Icelandic consumers. Continued improvements and innovations in our IPTV service have had the main objective to improve customer experience, in particular when and what content to consume.
This strategy has been highly successful, as attested by the change to an on-demand consumer behavior. Significantly increased mobile data consumption by tourists in Iceland has generated the same roaming revenue as in Q1 2017, before the roam-like-at-home regulation went into effect. The group´s cash flow is strong and sustains the group’s current investments and the renewed balance sheet, that was reduced last year by lowering debt with available cash.
Prices have started to increase for some of Siminn´s traditional products, and we see further prices changes next month, for certain number of our products. Wages in Iceland have been increasing rapidly during the past years and will continue as union based wage agreements will increase by 3% next month. Hence continuous management focus on cost control, simplification of processes, closing of legacy systems and increased automation is needed. Míla´s investment in fibre infrastructure is proceeding well. Recently Míla and Gagnaveita Reykjavíkur finalized a co-operation agreement in laying fibre infrastructure, which is the most expensive part of fibre network access investments. This co-operation will decrease Míla´s costs in connecting new homes. Possibly this will speed up fibre connection to areas which would otherwise have taken longer to finish.
Icelandic companies have been less engaged in buying IT products for the past months. Sensa has been affected by this development in the first quarter, but current service contracts and new projects are indicators of positive development in the immediate future. Sensa and Síminn are progressing well in moving their data center service to Verne Global data center close to the international airport, which will save the group substantial operating costs in the future. Furthermore, the co-operation with Verne will enable the group to sell world class data center services internationally. The first new customers have already started to use the group’s data center service in Verne’s facilities and their advantageous energy contracts that Verne made with the Icelandic power companies more than a decade ago.
Síminn´s 4G network reaches virtually all homes in Iceland. The sustained deployment of our new 1Gb/s base stations continues to increase the data speeds of our mobile network. The United Nations (International Telecommunication Union) awarded Iceland the first price for the best Information and communication technology (ICT) country in the world in 2017. This award illustrates that Iceland is currently the most advanced ICT country in the world. This is though not an endpoint for Iceland or Síminn. Síminn will not rest on its laurels, but continue to increase its mobile data speeds and coverage, introduce new TV and entertainment services, and to distribute its IPTV service over more networks than before. In light of this, we continue to be optimistic on behalf of our customers and shareholders for the near future.“
Further information
Orri Hauksson, CEO, tel. 354 550 6003 (orri@siminn.is)
Óskar Hauksson, CFO, tel. 354 550 6003 (oskarh@siminn.is)
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