Cable& Wireless Post Profits Rise of 72%

In their interim results for the six months ending 30 September network operator Cable&Wireless have posted impressive results.

Highlights:

– Group revenue up 5% to £1.6 billion, Europe, Asia & US up 4% and International up 5%

– Group EBITDA before exceptionals up 26% to £357 million. Europe, Asia & US EBITDA up 43% to £142 million and International EBITDA up 13% to US$448 million

– Group post-tax profit before exceptionals up 72% to £175 million

– Earnings per share before exceptionals and LTIP up 44% to 6.2 pence

– Interim dividend of 2.83 pence per share, an increase of 13%

Commenting on the results, Richard Lapthorne, Chairman of Cable and Wireless plc, said:

“Our two businesses have performed well during the first half. Europe, Asia & US has continued to grow its revenue and even more importantly its order book. The contracts the business is winning are at good margins and are long-term. The EBITDA margin in the Europe, Asia & US business continues to expand and now stands at 14%, up at least two percentage points in each of the last four half years.

“International has just produced one of its best results in a long time. Revenue grew by 5%, with our cost management helping to fuel growth in EBITDA of 13% with a 35% margin. International’s focus on building value by improving the customer experience should stand us in good stead.

“We’ve seen no effect from the broader economic slowdown in the first half. Indeed we continue to trade strongly and have raised EBITDA guidance for the full year accordingly. We’re not complacent but we are well prepared – the businesses have well developed cost reduction plans that will ensure that they will continue their progress.

“Whilst our trading position is in good health, the same cannot be said of the financial markets which are extremely volatile and which currently provide no basis for proper financial planning. Consequently, we have postponed a final decision on value realisation until we can foresee a sustained period of normality returning to the financial markets.

“We’re increasing the interim dividend by 13% to 2.83 pence per share. This reflects our confidence in the sustainable prospects for both businesses together with our growing visibility of the cash generation potential of Europe, Asia & US as it continues to deliver its strategic plans and objectives. We’re confident about our outlook – consequently we’ve raised EBITDA guidance and the interim dividend.”

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