Trading in line with expectations, Operational Improvements
Bigblu Broadband plc (AIM: BBB.L), a leading provider of alternative super-fast and ultra-fast broadband services, announces its unaudited interim results for the six months period ending 31 May 2023 (the "Period"). The Company has operations in Australia, Norway and a residual stake in Quickline Communications ("Quickline").
There was progress across the Company's business units in the period, with the focus on the introduction of new products and systems improvements. The Company is therefore well positioned for the second half of the year.
· Total revenue was £15.0m (1H22: £14.9m)
· Adjusted EBITDA1 increased 2.1% to £2.1m (1H22: £2.0m)
· Like for like revenue2 and adjusted EBITDA growth, on a constant currency basis increased by 3.1% and 21.4% respectively
· Adjusted Free cash inflow3 of £0.2m (1H22: inflow £0.4m)
· Net debt4 as at 31 May 2023 was £0.3m (1H22: Net Cash £4.5m) following the Acquisition in Australia, as well as one off restructuring payments made in Norway and Central.
· SkyMesh completed the acquisition of the satellite operations of Harbour ISP PTY LTD, a subsidiary of Uniti Group LTD in Australia (the "Acquisition") at a cost of c.£2.7m which included net 5.2k customers
· Total customers at period end were 62.6k (1H22: 60.4k), including the Acquisition
· The Company has pro-actively undertaken a reorganisation of the Norwegian business and restructured the central costs within the business. This has resulted in a reduction in the Norwegian workforce of approximately 30%, and a reduction of c.75% of our UK head office. Together bringing annual savings of £0.9m
· In Norway we completed the planned separation of the business into two legal entities, recognising the different attributes of each being our satellite and 5G technology business, typically lower capex, and our infrastructure business, typically higher capex.
· Quickline continues to be well supported by Northleaf with an addressable base of over 350,000 premises at the half year, with its hybrid Fixed Wireless (FWA) and Full Fibre infrastructure. The Company retains a 3.1% stake holding following further investment since the year end with a current carrying value of £5.9m. Northleaf have invested £110m in total since they acquired the majority stake.
1 Adjusted EBITDA is stated before interest, taxation, depreciation, amortisation, share based payments and exceptional items. It also excludes property lease costs which, under IFRS 16, are replaced by depreciation and interest charges.
2 Like for like (LFL) revenue and EBITDA is adjusted for new or divested businesses in both the current and prior year and adjusts for constant currency.
3 Adjusted Operating cash flow relates to the amount of cash generated from the Group's operating activities and is calculated as follows: Profit/(Loss) before Tax adjusted for Depreciation, Amortisation, Share Based Payments and adjusting for changes in Working Capital and non-cash items and excludes items identified as exceptional in nature. Adjusted Free cash flow being cash (used)/generated by the Group after investment in capital expenditure, servicing of debt and payment of taxes and excludes items identified as exceptional in nature.
4 Cash / Net debt excludes lease-related liabilities of £0.9m of under IFRS 16 (FY22 £1.4m).
Andrew Walwyn, Chief Executive Officer of Bigblu Broadband plc, commented:
"The overall performance of the Group is in line with the Board's expectations. We are carefully extending our product offerings with our partners in each region, thereby increasing our addressable markets, at the same time implementing new systems in each territory and cutting central headcount / other costs.
We have reorganised our Norwegian business and our Australian business has completed another important bolt on acquisition. We continue to develop products and solutions with our network partners that will enable customers to operate as effectively as possible, particularly at a time where large numbers of customers are likely to be working from home, whether full or part time.
Specifically, following the recent acquisitions by SkyMesh in Australia, the Board believes that its strategy of organic growth complemented by further bolt-on acquisitions should accelerate the Company's presence across Australia with the potential to achieve 80,000 customers over the next three years. Furthermore, the Board continues to assess all options to realise value for shareholders, including a potential spin out ASX listing, as previously announced.
The Board remains focused on maximising value and returns for shareholders. The combination of market dynamics and opportunities available to our business units provides a backdrop for delivering enhanced shareholder value."