Colt canters as revenue decline slows

The business communications firm, Colt, says profits fell in 2011 as regulation of mobile termination rates reduced revenues.

Turnover for the year was €1,554m, a drop of 1.9% against 2010. Profit before tax and exceptional items fell 6.6% to €72m.

The company achieved cost reductions to boost earnings before interest tax depreciation and amortisation (EBITDA) by 0.5% to €332m despite the falling revenues.

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Across the three business units Data saw revenues of €805.1m (2010: €801.1m) with Ethernet growth of 10.6% being offset by declining legacy products and lower asset sales.

Managed Services, which includes data centres, achieved revenues of €186.2m (2010: €172.6m), representing a rise of 7.9%.

The real problem was the Voice division (phone calls and the like) which saw turnover of €563.0m, a fall by 7.7% on 2010, with the majority of that decline occurring in the first half (11.3% decline compared to 3.9% for second half of 2011).

Colt says it expects "the pace of regulatory driven declines in 2012 to slow from the pace seen in 2011 which included a 50% reduction in German mobile termination rates."

The market liked what it got from Colt today, with the shares rising 1.2% although since February of 2011 the value of the group has dropped 36%.

BS