• B2B transactions increase in 1st half-year to EUR 23.8 million (previous year: EUR 23.3 million)
• easybell grows in 1st half-year to EUR 7.8 million (previous year: EUR 7.6 million)
• Gross profit increases in 1st half-year by 6 % or EUR 0.9 million to EUR 15.4 million
• EBITDA increases in 1st half-year to EUR 3.6 million (previous year: EUR 3.4 million)
• Investments in 1st half-year totalling EUR 3.1 million burden free cash flow

Düsseldorf, 14 August 2018
ecotel is very satisfied with the business development in the second quarter and remains on course in the process of transformation from a reseller to a network operator. The »ecotel Business Solutions« segment continues to grow and reached EUR 23.8 million in the first half-year 2018 (previous year: EUR 23.3 million). Revenue in the »easybell« (EUR +0.2 million) and »nacamar« (EUR +0.1 million) segments is likewise developing as planned for 2018. In the »ecotel Wholesale« segment, which has proven difficult to plan but does not contribute substantially to the group's profit margin, revenue decreased to EUR 9.6 million in the first half-year 2018 (previous year: EUR 30.6 million). The group's total revenue therefore declined in the first half-year to EUR 42.2 million (previous year: EUR 62.3 million).

These tendencies and developments are virtually identical in the quarter comparison: Revenue in the »ecotel Business Solutions« segment increased in the second quarter by EUR 0.2 million to EUR 11.9 million. Revenue in the »easybell« segment increased by EUR 0.2 million to EUR 3.9 million in the same period. The »nacamar« segment was able to repeat the previous year's revenue of EUR 0.5 million.

Continued essential driving factors that shape the revenue and gross profit development in the »ecotel Business Solutions« segment are the successful implementation of large-scale projects, the transformation from conventional ISDN-based products to higher-margin All-IP voice products with a broadband base line, as well as the acquisition of new customers in the area of All-IP voice products. With its own local exchange network ecotel achieves higher value creation and therefore higher gross profits. The gross profit margin in the »ecotel Business Solutions« segment increased in the first half-year 2018 to 48.5 % (previous year: 47.9 %) and in the second quarter 2018 to 48.8 % (previous year: 47.4 %). Currently, about 25 % of all telephone minutes are generated via the new All-IP voice products, and the tendency is on the rise.

Gross profit also increased substantially in the »easybell« segment, both in the half-year (+16 %) and quarter (+25%) comparison (2nd quarter 2018: EUR 1.7 million; 1st half-year 2018: EUR 3.2 million). This is evident in the growth of the segment of small business customers, who essentially obtain All-IP services (SIP telephony) via easybell. Due to the modified strategy in the »nacamar« segment of focussing on the business field of radio streaming (Internet radio), gross profit in this segment increased to EUR 0.5 million (previous year: EUR 0.4 million).

Consolidated gross profit increased by EUR 0.9 million to EUR 15.4 million in the first half-year.

Consolidated EBITDA totalled EUR 3.6 million (previous year: EUR 3.4 million) and EUR 1.8 million (previous year: EUR 1.6 million). Personnel expenses increased in the first half-year by EUR 0.3 million as a result of the increased number of employees. At the same time, the higher order volume and the temporary higher expenses for the transformation of ISDN-based connections to the new ecotel product pallet necessitated higher expenses since mid-2017 for service and service availability. In comparison with the first half-year 2017 the expenses in this area therefore increased by EUR 0.2 million. In addition, expenses for maintenance and scheduled repairs in the computer centre in the first half-year 2018 totalled EUR 0.1 million.

With a balance sheet total of EUR 43.0 million (previous year: EUR 53.1 million) and equity capital of EUR 22.5 million (previous year: EUR 22.7 million) ecotel reports an equity ratio of 52.4% (previous year: 42.9%). The expected continued high investments in customer equipment, IT developments, the computer centre and process optimizations totalling EUR 3.1 million in the first half-year 2018 (previous year: EUR 2.7 million) result in a negative free cash flow of EUR 0.9 million (previous year: EUR -0.8 million) and a net financial debt of EUR 0.7 million. The high value creation and the resulting possibility of achieving high gross profit margins with future-viable All-IP products together with the opportunities on the market for acquiring additional large-scale projects leave ecotel no other choice but to continue planning these investments for the near future.
The Management Board is convinced that ecotel continues on the right path, and therefore reconfirms the forecast for 2018. For 2018 the Management Board is therefore 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 »ecotel 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 the ecotel Group 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 data 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 national and 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