Management Review
Net revenue increased to DKK 128.2 million in 1Q 2016 (DKK 123.7 million in 1Q 2015). The rise was mainly driven by a satisfactory development in revenue from hosting and IT-outsourcing services. These are areas in which GlobalConnect is strengthening its position and is providing an unique offering as the company owns and operates all infrastructure layers from fibre optic network, datacentre facilities to server farms. 1Q 2016 revenue was affected by the consolidation activities on the German market during 2015. Mergers between among others EPlus and O2, Vodafone and Kabel Deutschland resulted in a slow down in GlobalConnects order intake in the period where the merging parties became integrated and strategically aligned. The period of standstill reduced GlobalConnects revenue growth in 1Q16. However, the development in the market is picking up again, and GlobalConnect still considers Germany as a market with attractive growth potential.
Gross profit increased to DKK 77.5 million in 1Q 2016 (DKK 75.5 million in 1Q 2015). As additional staff has been added, to advance GlobalConnects skillset within hosting and it-outsourcing, EBITDA amounted to DKK 41.9 million in 1Q 2016 (DKK 42.8 million in 1Q 2015). Due to higher depreciations and financial costs in 1Q 2016 than in 1Q 2015 Profit before tax was minus DKK 1.3 million (DKK 7.1 million in 1Q 2015). For the full year of 2016, GlobalConnect still expects to see a rise in net revenue, EBITDA and Profit before tax compared with 2015.
GlobalConnect experiences an increasing demand for value-added services, cloud services, security solutions and outsourcing, and is securing and developing the current market position by attending to these demands. In order to improve customer satisfaction even further, GlobalConnect continues to focus on network quality and process improvements. In Germany, the strategy of including B2B customers on GlobalConnects network is progressing and encompasses value added services. Furthermore, opportunities to expand the footprint of the German fibre optic network is being explored.
Results for Q2 2016 will be published on August 15th 2016.
HUG#2012630
