Buongiorno Group Results for H1 2009

• Press Release
• Source: Buongiorno S.p.A
• On 12:48 pm EDT, Thursday August 27, 2009

MILAN and LONDON, August 27 /PRNewswire/ -- The Board of Directors of Buongiorno Group (MTA, Borsa Italiana: BNG), a leading multinational in digital entertainment, today approved its half-yearly results for the six months ended June 30, 2009, prepared in accordance with the international accounting standards (IAS/IFRS).

    
    - Ebitda of Euro 18.6 million, up 14% compared to H1 2008 (Euro 16.3 
      million), thanks to the growth of the most profitable business
      segments and the decrease of fixed costs.

    - Ebitda for Q2 2009: Euro 10.2 million up 27.5% compared to
      Q2 2008 (Euro 8.0 million).

    - Revenues of Euro 132.3 million, down by 16.4% compared to H1
      2008 (Euro 158.2 million) due to a change in the accounting principles 
      of an Australian contract and the rationalization of the product 
      portfolio. More than 90% of revenues generated outside Italy.
  
    - Consolidated Net Profit of Euro 4.5 million: +87.5% compared
      to H1 2008.

    - Buongiorno's Consolidated Net Debt at June 30, 2009 was Euro
      62.2 million, compared to Euro 73 million at June 30, 2008 and Euro 
      66.7 million at December 31, 2008.

The company's gross debt decreased of nearly Euro 40 million, reaching its lowest point since the iTouch acquisition in July 2007 (Euro 98 million).

    
    - Integration of iTouch successfully completed after 24 months
      from the acquisition, exceeding saving expectations at the beginning of 
      the Integration Plan.

The results for the first half of 2009 posted an Ebitda up 14.1% (vs H1 2008), although marketing expenses remained largely in line with those for the same period of 2008 (-3%) and a moderate decrease of Revenues (-16.4%) due to the new terms of renewal of a relevant contract in Australia for online sales of phone air time, for which new accounting principles are net commissions only (and no longer the gross amount), and to the rationalization of the product portfolio, with the termination of those with negative or poor contributions, in particular those related to the Interactive Tv (B2B) in Iberia.

More than 90% of the company's Revenues continue to be generated outside Italy in the first half of 2009, as the Company strengthens its position as global mobile content leader.

Buongiorno's core business, which focuses on Mobile Content 1.0 services and content, has seen limited effect from the current macroeconomic situation, thanks to the opportunities of geographical growth on a global level. The total number of users who subscribe to traditional B2C services - BlinkoGold - increased during the period to over 7.6 million, with a large number of new subscribers located in areas where BlinkoGold has been recently launched. This increase occurred coupled with the rationalization of marketing expenses, which resulted in lower advertising investments on general media and a greater focus on innovative markets and media channels that offer higher returns on investment.

Other factors contributing to the company's performance were:

    
    - the enhancement of its B2O offering with a suite of technology and 
      CRM services called Intelligent Mobile Marketing (IMM), which
      was officially launched by mobile carrier Telefonica O2 in the UK in 
      February 2009 and is currently being proposed to leading telephone 
      operators throughout Europe;

    - the continuation of several contracts for the exclusive
      management of mobile telephone contest initiatives, known as 
      SuperContests, on behalf of large telephone companies, which is 
      strongly anti-cyclical and closely tied to the attractiveness in many 
      emerging countries of basic VAS (MC1.0) involving simple interactions 
      through SMS text messages. The most significant contracts are in Latin 
      America and Africa;

    - the expansion of existing contracts of "Full Portal" solutions offered 
      by Buongiorno to telephone carriers (B2O), including the
      creation and management of a game portal called Game Store for
      TelecomItaliaMobile, the development of customized Brew solution for 
      H3G's social networking handset (INQ), which recently won the Meffys 
      award for the best handset awarded by the Mobile Entertainment Forum 
    (MEF).

In the first six months of the year, Buongiorno continued its path towards Mobile Content 2.0 innovation in 4 areas. In particular efforts focused on:

    
    - the company's social networking proposition for mobile
      phones - peoplesound - that reached more than 300,000 subscribers;

    - the development and placement of solutions for the Application Stores 
      of mobile operators and handset manufacturers. In particular, Hellotxt, 
      the innovative social networks and microblogging site aggregator that 
      allows users to read their contacts' updates and update their
      status immediately and easily from their mobile phones, is now 
      available through Vodafone's Application Shop in Italy and Spain;

    - the progressive development of a marketplace for mobile
      advertising that could leverage on the users' reach aggregated by 
      Buongiorno Marketing Services, thanks to important agreements;

    - the validation study of valuable investment opportunities in
      relation to skill games, m-payment and mobile social gaming.

In the first six months of 2009, the market in which Buongiorno Marketing Services operates, saw Internet and digital media remaining solid (+7%) and a shift in usage patterns from offline media to digital and mobile media, and at the same time a drop in advertising investments, with offline media decreasing (between -17% and -30%).

In this scenario Marketing Services' revenues in Q2 2009 were increasing by 30% (Euro 3,9 million in Q2 2009 vs Euro 3 million in Q2 2008), while in the first 3 months of 2009 revenues were down by 40% ( Euro 3,2 million in Q1 2009 vs Euro 5,4 million inQ1 2008)

The main deals closed by Buongiorno Marketing Services have been:

    
    - the extension until 2011 of the multi-year contract of the digital 
      marketing program called Orange Wednesday for the telephone operator
      Orange in the UK;

    - the attainment of an exclusive contract to manage and sell
      advertising on all mobile internet sites - including iPhone - of the 
      Espresso Group (such as La Repubblica, Radio Deejay, Repubblica Sport 
      and TrovaCinema);

    - several mobile marketing campaigns for important clients such as: 
      BMW, Citroen, Ford and the Terme di Sirmione (Sirmione Springs).

Buongiorno-iTouch Integration Plan

At the end of June, the company substantially completed its two-year Buongiorno-iTouch Integration Plan, which, in 24 months, resulted in the creation of a new, completely integrated company in terms of products, processes, and technical and logistical infrastructures. At June 30, 2009, the savings generated exceeded the objective of Euro 10 million expected at the beginning of the Integration Plan. All the main projects set forth in the Integration Plan continued in the first half of 2009. In particular, the streamlining of the company's processes and product offering allowed the number of employees to be reduced to 994, down 21% from 1,253 at the beginning of the Plan; the streamlining of the company's structure continued, allowing the number of legal entities to be reduced from over 100 to 77. The plan aimed at streamlining technological aspects was also nearly completed. All of the planned Data Center closings were completed, and 31 of the 34 migration projects undertaken following the iTouch merger were successfully completed (the last three projects, in Spain, Portugal and Brazil, will be completed this year). These activities are in addition to those completed as of December 2008, including the closing of offices in 13 countries and the transfer of Customer Care activities to South Africa.

For further information, please contact:

    
    BUONGIORNO
    Eleonora Villanova
    Global PR & IR Executive
    Tel. +39-02-582131
    Email: eleonora.villanova@buongiorno.com

Buzz up!