Digiweb returns to profit despite revenues falling 7%

TELECOMS GROUP Digiweb returned to profit last year despite a dip in revenues.

Accounts due to be filed shortly show the Co Louth group recorded pre-tax profits of €11.2 million in 2011, a turnaround from the €2 million in pre-tax losses recorded a year previously.

The return to profit comes in spite of revenues falling by 7 per cent from €41.67 million to €38.9 million last year.

The company attributed the turnaround to a sharp fall in debt following a restructuring and refinancing last year.

Earnings before interest, tax, depreciation and amortisation (Ebitda), operating profits and revenues were all double or more compared to 2009 levels, a spokesman for the company said. “Debt reduction over the two years, and further since year end, has been material.”

The directors’ report states: “The group has significantly strengthened its balance sheet. To date the group has strengthened its net asset position by successfully paying down and reducing debt by €20.3 million when compared to December 31st, 2010.

“Further reductions secured post year of €5.9 million result in a positive net asset position of €11.5 million as of the date of the financial statements.”

Digiweb has made a series of acquisitions over recent years – the purchase of TalkTalk, Smart Telecom, Internet Ireland and Novara – and job numbers have increased from 101 in 2009 to 154 today.

“With the integrations completed and debt reduced, we are well positioned for the next growth and acquisition phase, and have some prospective acquisitions under review,” a company spokesman said.

Established in 1997 by chief executive and 2012 Ernst Young Entrepreneur of the Year industry award finalist Colm Piercy, the company was initially focused on the area of web-hosting, but has developed to become a major independent telecoms player offering a full service portfolio.

The group is now operating in Ireland, the UK and Belgium, and supports just under 100,000 enterprise, home, wholesale and public sector clients.

According to the directors’ report: “The strong improvements in profitability, scale and balance sheet now positions Digiweb optimally for the next phase of organic growth and a pipeline of acquisitions are being contemplated.”

On the group’s future developments, the directors say “Digiweb will continue to expand and deepen its service offerings to meet new opportunities”.