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Colt TV 26 July 2012 © 2010 Colt Technology Services Group Limited. All rights reserved. Today’s agenda 2 1 H1 Business update 2 Financial results 3 Becoming a solutions led business 4 Q&A H1 Business update Rakesh Bhasin © 2010 Colt Telecom Technology Group Services Limited. Group All rights Limited. reserved. All rights reserved. Half year headlines Six months ended 30 June € millions 2012 unaudited 2011 unaudited Movement Revenue 797.9 766.2 4.2% EBITDA 161.8 157.2 2.9% • Revenue growing, but not where we had hoped it would be. Spend not adjusted in line with revised forecasts • Cost pressures - increased investment and foreign currency impact • Solid performance in Carrier Voice but Corporate & Reseller declined 4 Business update • Half-year growth for the first time in many years • Pipeline increasing in quality and quantity and larger deals • Economic uncertainty – higher churn from smaller accounts • Continued positive sentiment towards our strategy • More managed solutions sales - Network and IT • More spend from larger accounts but can lead to “lumpy” revenue 5 External market news It’s a tough market out there Missed revenues by 5% Cut guidance and eliminated 2012 dividends Drop in profits and cut dividends 6 Six key programmes and TSAT Six key programmes Customer satisfaction (TSAT) Transactional Services Business Sales process 77% Speedboat Service Delivery - new 81% DCS Expansion Incident management 74% Portfolio Management Billing queries 62% Profitability Renewal 90% Leadership and culture Total 74% Making progress but a lot more to do in H2 7 What we need to do now • Continue to invest in our strategic agenda • Understand our customers and deliver what they need – at speed • Share ideas and think differently • Efficiently execute projects • Spend what we really have to – not what’s in our budget We need to realise revenue faster and continue to manage our cost tightly 8 H1 results update Mark Ferrari © 2010 Colt Technology Services Group Limited. All rights reserved. H1 financial headlines Six months ended 30 June 2012 unaudited 2011 unaudited Movement 407.7 400.6 1.8% Managed Services 99.9 86.6 15.4% Voice 290.3 279.0 4.1% € millions Data • Data revenue growth reflects continued take-up of Ethernet services but legacy bandwidth services continue to decline • Managed Services revenue increased due to 2011 modular data centre contracts and an increase in sales activity with enterprise customers • Carrier Voice upsurge driven by increased international traffic through new Voice trading platform. Corporate and Reseller decline due to price pressures 10 How are our business units doing? Six months ended 30 June 2012 unaudited 2011 unaudited Movement 479.5 450.8 6.4% CES 298.8 302.0 (1.1%) DCS 19.6 13.4 46.3% € millions CCS • CCS continues to develop the channel strategy to increase revenue and key focus remains on business automation • CES good progress on Delta & Gamma programme. Increased appetite from customers to move from a DIY network provision to more of a Managed Service • Continued market excitement around our modular product and overall pipeline increasing. New site acquired in Netherlands with anchor tenant. 11 What the markets say “Colt have succeeded where others have not” “Colt has rediscovered growth” Deutsche Bank Analyst: Andrew Darley “A positive H1 trading update this morning ” Analyst: Lorne Daniel 12 “Solid H1, story on track” Morgan Stanley A solutions led business Clark Turabee © 2010 Colt Technology Services Group Limited. All rights reserved. Inner Circle © 2010 Colt Technology Services Group Limited. All rights reserved. Inner Circle • We want a high performance culture • We will continue to invest in it • So, the Inner Circle journey continues……to Istanbul! • www.colt.net/innercircle 15 Q&A © 2010 Colt Technology Services Group Limited. All rights reserved.