21.03.2018
1&1 Drillisch Aktiengesellschaft DE0005545503
DGAP-Adhoc: 1&1 Drillisch AG on a Steady Course of Growth in 2017
DGAP-Ad-hoc: 1&1 Drillisch Aktiengesellschaft / Key word(s): Final
Results/Forecast
1&1 Drillisch AG on a Steady Course of Growth in 2017
21-March-2018 / 21:27 CET/CEST
Disclosure of an inside information acc. to Article 17 MAR of the Regulation
(EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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1&1 Drillisch AG on a Steady Course of Growth in 2017
- Number of customer contracts rises by 48.0% to 12.64 million (2016: 8.54
million)
- Revenues rise by 15.7% to EUR2.81 billion (2016: EUR2.43 billion)
- Adjusted EBITDA from continued operation grows by 37.2% to EUR532.2
million (2016: EUR387.9 million)
- Dividend proposal of EUR1.60 per share, total disbursement of EUR282.8
million (2017: EUR98.6 million)
- Forecast 2018: approximately 1.2 million new customer contracts,
approximately EUR3.7 billion in revenues, EBITDA of approximately EUR750
million
Maintal, 21 March 2018 - 1&1 Drillisch AG (ISIN DE 0005545503) continued on
its course of growth in 2017. The Company was able to improve substantially
yet again the number of customer contracts, the revenues and the operating
profit figures and fulfil its forecast.
The year was marked by the merger of Drillisch AG and 1&1 Telecommunication
SE (1&1). The successful conclusion of the complete transaction has created
a powerful full-service telecommunications provider that has many different
possibilities to take advantage of any opportunities for growth that arise.
Accounting effects of the transaction with United Internet AG
In the accounting, it is assumed that 1&1 as the economic acquiree has
acquired the shares of the former Drillisch AG ("Drillisch"). The
calculation of the goodwill and the hidden reserves as well as hidden
liabilities that must be reversed in the process of the purchase price
allocation and the accounting principles that are to be applied as of the
point in the time of the acquisition are based on the perspective of the
economic acquiree. The consequence is that there is no longer any
comparability of the balance sheet and comprehensive income statement of
previous Drillisch financial statements because, for one, the figures of 1&1
must be given as the comparable figures of the previous year and, for
another, the comprehensive income statement must be prepared according to
the cost-of-sales method and the accounting principles of 1&1 must be
applied. The date of registration of the Capital Increase II in the
Commercial Register is deemed the point in time of the acquisition, i.e. the
time at which the economic acquirer obtained control over the acquired
company; in the present case, that date is 8 September 2017. The inclusion
of Drillisch as the acquired company in the consolidated financial
statements is therefore only proportional for the time period from the
moment control was gained. Drillisch is consequently considered only for
about four months in the comprehensive income statement and the capital flow
statement of the Annual Report per 31 December 2017.
Growth of subscribers and revenues
In comparison with the closing date of the previous year, the number of
customer contracts in the current product lines rose across all customer
groups by 4.10 million (48.0%) - thereof 3.35 million from the first-time
inclusion of 1&1 Drillisch - to 12.64 million subscribers (2016: 8.54
million). The figure of 3.99 million customer contracts was acquired in
mobile internet business (thereof 3.35 million from the Drillisch takeover)
and the total number of contracts rose to 8.30 million (2016: 4.31 million).
The number of DSL full-service contracts (ULL = unbundled local loop) rose
by 110,000 contracts to 4.34 million.
Besides of the12.64 million customer contracts in current product lines, the
company holds a further 0.47 million contracts without monthly payments and
service provider contracts (volume tariffs / MSP tariffs). In addition to
0.11 DSL contracts in the discontinued product lines (T-DSL / R-DSL).
Revenues increased by EUR382.2 million (15.7%) to EUR2,812.3 million (2016:
EUR2,430.1 million).
Increase in earnings despite further investments in customer growth
Despite the investments in customer growth, the adjusted consolidated EBITDA
from the continued operation (earnings from the continued operation before
interest, taxes, depreciation and amortisation) increased by EUR144.3
million (37.2%) to EUR532.2 million in fiscal year 2017 (2016: EUR387.9
million). The adjusted EBITDA margin from the continued operation rose to
18.9% (2016: 16.0%).
The adjusted consolidated EBIT from the continued operation (earnings from
the continued operation before interest and taxes) rose by 23.4% to EUR468.1
million (2016: 379.3 million). The adjusted EBIT margin from the continued
operation rose to 16.6% (2016: 15.6%).
Dividends
Management Board and Supervisory Board will propose a dividend in the amount
of EUR1.60 per share to the Annual General Meeting scheduled for 17 May 2018
(previous year: EUR1.80), corresponding to a disbursement volume for 176.7
million shares of EUR282.8 million (previous year: disbursement volume for
54.7 million shares of EUR98.6 million).
1&1 Drillisch wishes to share its business success appropriately with its
shareholders in future as well. In accordance with the Company's dividend
policy, the proposed disbursement should always correspond to about 80% of
the consolidated operating profit unless the funds are required for the
further development of the enterprise.
Outlook
1&1 Drillisch in an excellent position to take the next steps in the
Company's development and is looking ahead to the future with confidence.
1&1 Drillisch is planning an increase of about 1.2 million in the number of
customer contracts subject to charge. Growth drivers are coordinated brand
management, higher marketing budgets and the significantly increased
offering of subsidised smartphones (mostly without initial additional
payment) in sales via GMX and WEB.DE as well as for the 1&1 Drillisch
discount brands (smartmobil.de, yourfone, winSIM and others). These measures
will affect both new and current customers.
In May 2014, the International Accounting Standards Board (IASB) promulgated
the standard IFRS 15 "Revenue from Contracts with Customers". Application is
mandatory for reporting periods beginning on 1 January 2018 and later.
Based on IFRS 15, 1&1 Drillisch projects a rise in revenue to about EUR3.7
billion (2017: EUR2.8 billion) in fiscal year 2018. This will result from
the planned organic growth, the consolidation of Drillisch for the entire
year and the increased offering of subsidised smartphones in conjunction
with the earlier realisation of hardware sales in accordance with IFRS 15
(revenue effect: approximately EUR200 million).
The EBITDA in the Group is expected to reach approximately EUR750 million
(2017: EUR532.0 million). This includes about EUR300 million in diminished
earnings from the additional subsidies for smartphones (recovered via higher
rate prices) and the contrary positive effect of about EUR300 million from
balance sheet disclosures pursuant to IFRS 15. Synergies of about EUR50
million from the merger of 1&1 and Drillisch, related especially to savings
during the procurement of network advance services and smartphones, are also
included in the planned EBITDA. These cost savings are contrasted by about
EUR30 million in diminished earnings from an increased marketing budget and
about EUR20 million in one-off expenditures for integration projects.
Performance Indicators Pursuant to IFRS - Comparison 2017 v. 2016
In EURm 2016 2017 in %
Revenue 2,430.1 2,812.3 +15.7-
%
EBITDA1 (adjusted) 387.9 532.2 +37.2-
%
EBITDA margin1 (adjusted) in % 16.0% 18.9%
EBIT1 (adjusted) 379.3 468.1 +23.4-
%
EBIT margin1 (adjusted) in % 15.6% 16.6%
Profit per share 2.08 2.28 +10.1-
%
Net payments of the operating activity from the 65.4 294.1 +349.-
continued operation 6%
Customer Contracts (Million)
Current product lines
Access, contracts 8.54 12.64 +48.0-
%
thereof mobile internet 4.31 8.30 +92.6-
%
thereof DSL/VDSL 4.23 4.34 +2.6%
(1) Adjusted for one-off expenses totalling EUR28.2m related primarily to
the sale of yourfone Shop GmbH and the restructuring of the retail trade per
the end of 2017.
Note:
Financial performance indicators such as EBITDA, EBITDA margin, EBIT, EBIT
margin or free cash flow are used in addition to the disclosures required by
the International Financial Reporting Standards (IFRS) in the annual and
interim financial statements of 1&1 Drillisch AG and in ad hoc reports
pursuant to Art. 17 MAR to ensure a clear and transparent presentation of
1&1 Drillisch's business development. Information about the use, definition
and calculation of these performance indicators is available on pages 37-38
of the Annual Report 2017 of 1&1 Drillisch AG.
The complete Annual Report will be made available on the Company's home page
on 22 March 2018.
https://www.1und1-drillisch.de/investor-relations/reports
Maintal, 21 March 2018
1&1 Drillisch AG
The Management Board
Disclaimer: This report contains statements regarding the future which are
based on the current assumptions and projections of the 1&1 Drillisch AG
management. Various risks, uncertainties and other factors, both known and
unknown, can cause actual developments, especially in the results, financial
position, and the business of our Company, to deviate substantially from the
projections about the future as they are shown here. The Company does not
undertake any obligation to update such future-oriented statements and to
adapt them to future events or developments.
Contact:
Oliver Keil
Head of Investor Relations
Mail: [email protected]
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Language: English
Company: 1&1 Drillisch Aktiengesellschaft
Wilhelm-Röntgen-Straße 1-5
63477 Maintal
Germany
Phone: +49 (0)6181 412 218
Fax: +49 (0)6181 412 183
E-mail: [email protected]
Internet: www.drillisch.de
ISIN: DE0005545503
WKN: 554550
Indices: TecDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated
Unofficial Market in Berlin, Dusseldorf, Munich,
Stuttgart, Tradegate Exchange
End of Announcement DGAP News Service
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667173 21-March-2018 CET/CEST
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