SOURCE: Telio Holding ASA

April 29, 2008 03:12 ET

FINANCIAL RESULTS 1ST QUARTER 2008

Telio reports strongest profits ever with an EBIT of NOK 12 million in Q1 08. Revenues were NOK 94.3 million, an increase of 7% compared to Q1 07. EBITDA margin was 24%.

OSLO, NORWAY--(Marketwire - April 29, 2008) - Telio reports strongest profits ever with an EBIT of NOK 12 million in Q1 08. Revenues were NOK 94.3 million, an increase of 7% compared to Q1 07. EBITDA margin was 24%.


Revenues for the quarter were NOK 94.3 million, the same as in Q4 07. The company was able to sustain the Q4 07 revenue level despite the imposed reduction in termination prices from 1 January 2008 and Easter holidays in March.

Profits were the strongest ever for the company with an EBIT of NOK 12 million compared to NOK 4.1 million in Q1 07. Profit before tax was NOK 10.9 million. In addition to continued growth and profitability, key financial indicators included an improved gross margin and continuous scaling of OPEX. EBITDA margin for the quarter was 24%.

The Telio Group added net 4,210 VoIP customers in the first quarter. In Norway, the company added net 2,268 VoIP customers, giving a total of 104,854 customers at the end of the quarter.

Denmark and the Netherlands achieved a net customer intake of 1,950 customers during the quarter.

Telio is still in a build-up phase for establishing distribution channels for the SMB product launched towards the end of 2007. Resellers and agents have been recruited and performance is showing promising progress. The product offers a competitive value proposition with a monthly subscription fee of NOK 159 with a start up fee of NOK 0.39. Call charges are similar to the consumer product with zero costs to Western Europe, Poland, North America (incl. mobile), and China.


Financials

Total gross profit in Q1 08 was NOK 57.3 million (61%) compared to NOK 51 million (58%) in Q1 07.

Average monthly revenue per customer (VoIP Norway) during the quarter was NOK 261 compared to NOK 268 during the previous quarter. Average monthly gross profit per customer for Norwegian VoIP customers was NOK 168 during the quarter (NOK 173 in Q4 07).

Salaries and personnel costs were NOK 12.5 million in Q1 08 (13% of revenues) including NOK 0.7 million related to the stock option plans and change in contingent liabilities related to social security of NOK 0.1 million.

Selling and marketing costs were NOK 10.7 million in Q1 08 (11% of revenues). The company capitalised customer acquisition costs of NOK 2.1 million during the quarter.

Operating profit was NOK 12 million in Q1 08 and profit before tax was NOK 10.9 million.

Finance costs include additional interest expense and establishment fee related to the repayment of the bond loan at the end of March of NOK 0.9 million.

Deferred revenues (current liabilities) decreased by NOK 1.9 million during the quarter. Deferred income at the end of Q1 08 was NOK 45.5 million of which NOK 27 million has been collected and is non-refundable. Total financial lease debt was NOK 18 million at the end of the quarter which is NOK 1.3 million below the end of the previous quarter (NOK 19.3 million). Of the total financial lease debt, NOK 16 million was classified as current liabilities (payable within one year from the balance sheet date).

The bond loan of NOK 60 million was repaid to bondholders 27 March 2008, thus the company does no longer have any long-term interest bearing debt (except for financial lease).

Consolidated equity was NOK 65.9 million at the end of Q1 08 (equity ratio of 31%) compared to NOK 57.8 million at year-end.

Cash flow from operations was NOK 16.5 million in Q1 08. Cash and cash equivalents were NOK 72.1 million at the end of the quarter after repayment of the bond loan.

The Telio Group had 105 employees (FTE) at 31 March 2008.

Legal matters update

There is no new information to be reported regarding the upcoming ecom court trial in June 2008. The appeal in the Labs 2 court case is scheduled ultimo April 2008 in Borgarting lagmannsrett.


Shareholder information

The total number of registered shares outstanding at the end of Q1 08 was 19,392,700 (19,392,700 at the end of Q4 07) out of which 97,100 shares were owned by Telio Holding ASA (102,100 shares at the end of Q4 07). The total number of shareholders was 513 at the end of Q1 08 (531 at the end of Q4 08) and 27% of the shares were registered abroad at the end of Q1 08 (27% at the end of Q4 07).

Total outstanding options at the end of Q1 08 were 1.8 million (1.81 million at the end of Q4 07) with an average strike price of NOK 16.06 (NOK 16.04 at the end of Q4 07). The stock price moved from NOK 12.10 to NOK 13.60 (+12%) during the quarter.




                         Oslo, 28 April 2008

                         Board of Directors
                          Telio Holding ASA

http://hugin.info/136135/R/1214348/252924.pdf

http://hugin.info/136135/R/1214348/252922.pdf

Postboks 1203 Vika
0110 OSLO

Tel: +47 815 69 070
http://www.telio.no

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