• Consolidated revenue grows by EUR 4.0 million to EUR 120.6 million
• B2B transactions increase further from EUR 45.3 million to EUR 47.6 million
• Gross profit increases by EUR 1.5 million to EUR 29.9 million
• EBITDA remains constant at EUR 7.0 million
• Recommended dividend: EUR 0.13 / share

Düsseldorf, 22 March 2018

In 2017 ecotel was again able to increase total revenue to EUR 120.6 million (previous year: EUR 116.6 million). The high-margin core segment of Business Customers continued the positive trend of recent years. Several key account projects were successfully implemented in 2017 and new larger projects were acquired. While the overall market declined by 1.5 % in 2017, ecotel was able to increase revenue by 5 % to EUR 47.6 million in the B2B segment. This growth is especially positive in view of the additional efforts necessary for the ongoing transformation from traditional ISDN technology to future-viable All-IP products.

The easybell segment was able to increase revenue slightly in 2017 to EUR 15.2 million. Transactions with NGN voice services for small business customers (SIP trunk) also developed positively in this segment. With respect to access products, easybell has nearly completed the upstream supplier migration from Telefonica Deutschland to other suppliers in the last two years. Transactions with call-by-call minutes continue to decline as expected, but this has been cushioned by the introduction of new products.

The new strategy of the »nacamar« segment caused revenue (EUR 2.0 million) in this segment to increase in 2017 for the first time. For example, a contract from public radio was acquired in financial year 2017. Since mid-2017 nacamar is now the provider for radio streaming of ARD institutions (including BR, NDR, SWR, WDR).

The development and revenue in the »ecotel Wholesale« segment remain difficult to plan. With revenue of EUR 55.8 million (previous year: EUR 54.5 million) this segment also grew in 2017.

The group's gross profit once again increased, to EUR 29.9 million (previous year: EUR 28.4 million). The gross profit margin, especially in the core segment »Business Customers« remained nearly constant at 47.7 % (previous year: 47.9 %). In the coming years ecotel is expecting significant positive overall margin effects from the increasing share of NGN transactions and the resulting increase in value creation.

With the new, promising IP-based product portfolio ecotel deliberately continues to exploit additional sales opportunities and market potentials, even if this has a temporary negative effect on profitability. The increased order volumes and the new product spectrum require temporary higher expenses for resources (technology and personnel), as well as system and process adaptations, that burden EBITDA. As a result, ecotel was able to achieve EBITDA of EUR 7.0 million (previous year: EUR 7.0 million). That figure includes expenses totalling EUR 0.1 million from the share in regulation of damages from manipulated contracts adversely affecting ecotel and other carriers.

The necessary investments in individual, high-performance customer equipment results in higher depreciations. In consideration of the financial result and the taxes on earnings and profits, as well as the deduction of the minority shares, the resulting consolidated surplus totals EUR 0.5 million (previous year: EUR 0.8 million), which corresponds to earnings per share of EUR 0.13 (previous year: EUR 0.24).

The excellent order situation, the positive business development and the consistently solid balance sheet figures have allowed the Management Board in coordination with the Supervisory Board to recommend a dividend of 100 % of the consolidated surplus, or EUR 0.13/share, at the Annual General Meeting.

In the coming years ecotel will continue to invest in high-performance customer equipment on a target-oriented and success-related basis, which will burden the free cash flow. However, these investments in growth will allow the continued effective expansion of the high-margin local exchange network and the resulting positive effects on revenue. The latest additions to ecotel's product selection offer customers everything they need to master the transition from ISDN to All-UP with the greatest possible success and efficiency. As part of their multi-carrier strategy, ecotel selects and manages this product portfolio in a way that is tailored to the customer's individual needs. The success of this approach is reflected in the number of new contracts acquired in ecotel's vital Business Solutions segment, where the company managed to secure yet another significant gain in 2017. Encouraged by these accomplishments, the Management Board is predicting consolidated revenue ranging between EUR 90 and 120 million and EBITDA in the realm of EUR 7.0 to 8.0 million with a slightly increased gross profit margin, resulting in enhanced gross profits in the core Business Solutions segment.


About ecotel communication ag:
The ecotel Group (hereinafter »ecotel«) is a group of companies operating throughout Germany since 1998 that specialises in the marketing of information and telecommunications solutions for different target groups. The parent company is ecotel communication ag with headquarters in Düsseldorf (hereinafter »ecotel ag«).

Currently ecotel provides more than 50,000 customers nationwide with about 10,000 data connections and more than 80,000 voice connections.

The company's core segment is represented by »ecotel Business Solutions«. In this segment ecotel offers business customers nationwide an integrated product portfolio consisting of voice and date services (IT/telecom solutions). The focus is on enterprises with more than 50 employees.

The »ecotel Wholesale« segment comprises the services for other telecommunications companies, including network interconnections with more than 100 international carriers.

The »easybell« segment includes all transactions of the easybell group, which consists of four companies. The easybell segment markets broadband Internet access and VoIP telephony for private customers, as well as SIP trunking services for smaller enterprises.

In the »nacamar« segment nacamar GmbH offers streaming services for media enterprises on the basis of its own Content Delivery Network (CDN). With AddRadio, nacamar is the market leader in Germany.

The corporate group, with its main office in Düsseldorf, has about 270 employees, including subsidiaries and holdings.

Note:
This publication is not an offer for the sale nor an invitation for the purchase or subscription of securities. This publication is not a securities brochure. This publication and the information contained therein are not intended for direct or indirect dissemination to or within the United States of America, Canada, Australia or Japan.

PR office:
Business and Financial Media
Annette Drescher (Assistant to the Managing Director)
Phone: 0211-55 007-740
Fax: 0211-55 007 5 740
E-mail: presse@ecotel.de

Business media
Bernadette Loosen-Flanz (PR)
Phone: 0211-55 007-316
Fax: 0211-55 007 5 316
E-mail: presse@ecotel.de

For further information please visit us on the web at www.ecotel.de