GTS Central Europe: stable revenue, 20% EBITDA growth

15.08.07

GTS Central Europe, one of the leading telecommunications service providers of the region, today reported its financial results for the first half of 2007. Achieving a solid underlying performance, the company’s revenues after elimination of inter-company transactions reached EUR 192 m that practically equalled with the same period last year. EBITDA grew by 20% to EUR 34,5 m compared to the same period in 2006.

This significant EBITDA growth was boosted primarily by GTS Novera, Czech subsidiary of GTS Central Europe, the leading alternative service provider of the Czech telecommunications market. GTS Novera reported an EBITDA of EUR 16.3 m, up by 36% over H1 2006, mainly due to a greater efficiency through successfully accomplished integration followed up by the transformation of the company. Despite the EBITDA growth, revenues declined slightly by 6% to EUR 101,6 m. This was compensated by the strong performance of GTS Central Europe's other four subsidiaries in their market.

In Slovakia, GTS Nextra delivered excellent results for H1 2007 and contributed EUR 11.8 m to group revenues, against EUR 9.6 m in H1 2006. EBITDA increased significantly by 37% to EUR 3 m during the period under review. Hungarian subsidiary GTS Datanet also maintained its market position and reported EUR 27,5 m revenue, up by 14% over H1 2006. EBITDA decreased slightly by 1% to EUR 4.3 m as a result of the company’s local loop unbundling based investments.

Revenue of GTS Telecom, a key alternative service provider in Romania increased by 16% to EUR 7.3 m, and EBITDA amounted to EUR 1.6, up by 8% compared to H1 2006. In Poland, GTS Energis preserved its leading position in the alternative market; revenues were approximately flat at EUR 50 m, while EBITDA reached EUR 10.8 m against EUR 9.5 m in H1 2006.

“2006 saw a number of positive developments for our company” said Tamás Polgár, CEO of GTS Central Europe. “In line with our strategy, we continued to focus on regional businesses and executed a number of prestigious wholesale and retail projects including a Central European MPLS network development for JYSK Danish furniture vendor and Palace Cinemas multiplex movie operator.”

“At the same time, we took even more advantage of synergies created by our earlier acquisitions and increased efficiency through network interconnection, technology unification and improvements in headcount productivity. As a result, the company enjoyed a successful period exceeding our own expectations with a 20% EBITDA growth, while group revenue remained broadly stable. These figures underline that we are on track to achieve our targets set for this year. Regarding our strategy going forward, we expect similar results for the second half of the year” he added.

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About GTS Central Europe
GTS Central Europe (GTS CE) is a multi-layered infrastructure based provider of integrated telecommunications solutions for those countries of Central and Eastern Europe lying between Frankfurt and Istanbul. Using its own regional fiber network GTS CE provides fixed voice, data, IP (Internet Protocol), MPLS and broadband services primarily to business customers as well as services to other telecoms carriers, mobile operators and providers of content. GTS CE’s primary countries of operation are Czech, Poland, Hungary, Slovakia and Romania with network extensions and local partnerships into the neighbouring countries of the Ukraine, Baltic States, Bulgaria, Russia, Croatia, Slovenia, Serbia, Moldova and Turkey. GTS CE has more than 1500 employees and reached EUR 382 m revenue and 58.7 m EBITDA in 2006.
For further information, please visit www.gtsce.com.