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Colt Maintains Earnings Guidance As Profit Hit By Restructuring(Alliance News Via Acquire Media NewsEdge) LONDON (Alliance News) - Colt Group SA Thursday maintained its full-year guidance for earnings before interest, tax, depreciation and amortisation, as its saw profit in the half year to end-June hit by restructuring and reorganisation costs. In April the company lowered its EBITDA forecasts for 2014, saying it expected EBITDA before restructuring costs to be between 5% to 10% below the then-consensus estimates of EUR325 million. Colt Thursday posted EBITDA of EUR145.4 million for the six months ended June 30, down from EUR158.0 million a year earlier. Pretax profit was EUR5.2 million, down from EUR16.7 million, as revenue declined to EUR770.4 million from EUR788.9 million, and it posted exceptional costs of EUR8.4 million related to the reorganisation and restructuring of its business. Revenue was hampered by regulatory price reductions hitting Colt's Voice Services business, changes in its product mix, withdrawal from low-margin carrier voice trading contracts, and pricing pressures on its bandwidth products. Colt expects to post additional restructuring expenses in the second half of the year, and continues to expect the total cost of its reorganisation plan to be around EUR30.0 million. The company said that it had focused on reorganising the four lines of its business in the first half; and its focus going forward will be transforming its IT Services business to rationalise its product portfolio and supporting platforms. It said expects its Voice Services segment to continue to decline in the second half as it completes its exit from low margin carrier voice trading contracts. Meanwhile, Colt said it expects Network Services and Data Centre Services to continue to trade in line with current trends. "We have already started the process of implementing improvements to our business, and I remain convinced by the opportunities available to us," said Chief Executive Rakesh Bhasin in a statement. Shares in Colt were trading down 0.6% at 141.50 pence Thursday morning. Copyright 2014 Alliance News Limited. All Rights Reserved. |