Pre-Close Trading Update
Manx Telecom Plc (AIM: MANX; the "Company" or "Group"), the leading communication solutions provider on the
The Board confirms that trading during 2017 was in line with management expectations, with strong underlying cash flow continuing to support our progressive dividend policy. Both underlying EBITDA and underlying FCF returned to solid growth in the second half of the financial year.
The Company's core domestic business was stable during the year. High speed broadband services are available to 93% of customer premises on the island and coverage is expected to grow further as the Company continues to invest in its network. Take up of high speed broadband continues to increase, with 52% of our broadband customer base now on VDSL or VDSL+, up from 40% at the end of December 2016, whilst we are encouraged by our early stage progress with regards to our FTTP ('Fibre to the Premise') rollout. As expected, fixed voice saw moderate decline for the 12-month period, whilst mobile performed solidly for the year as a whole.
As previously communicated, Group revenue for the year has been impacted by the consolidation of customers in our data centre business, which occurred during 2016, and the rescheduling of the directories publication. These effects have been partially offset by continued strong growth in Global Solutions and some recovery in data centre revenues in the second half of 2017, resulting in broadly flat Group revenues year on year.
Cash performance was particularly strong in H2, aided by tight control of working capital and capital expenditure, resulting in closing net debt being lower than market expectations. This cash performance has triggered provision for incentive payments which will result in a moderately lower underlying EBITDA than last year.
The execution of the transformation programme which was launched in October 2016, remains on track. As previously communicated, we will continue to incur some exceptional costs in 2018, with the associated benefits starting to accrue in 2018. A more detailed update on the programme will be provided in the full year results.
Preliminary results for the 12 months to 31 December 2017 will be announced on 15 March 2018.
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/ 2014.