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Sýn hf. : Merged company completes its first full year under challenging market conditions

Sýn`s 2018 annual financial statement was approved by Sýn`s CEO and board of directors at a board meeting 27th of February 2019. The financial statement was audited and signed under unqualified opinion by the firm`s auditors. The financial statement will be presented for confirmation at the firm`s annual general meeting on the 22nd of March 2019.

In December 2017 the company purchased certain assets and operations of 365 Miðlar hf., and this influences the comparison between periods.

Sýn and the Faroese company Tjaldur have agreed on heads of terms in the merger of P/F Hey a subsidiary of Sýn and the Faroese IT company Nema a subsidiary of Tjaldur. Sýn being the sole shareholder of P/F Hey will hold 49,9% of the merged business with Tjaldur owning 50,1%.  P/F Hey`s assets and liabilities have been classified as held for sale in the balance sheet but the company`s operations in 2018 have not been presented as discontinued in the income statement as it is considered unsubstantial in the company`s accounts.

 

       ·      Revenue in the fourth quarter of 2018 amounted to ISK 5,754 million, an increase of 34% from the previous year.

       ·      Total revenue for 2018 amounted to ISK 21,951 million, an increase by 54% from the previous year.

       ·      The quarter`s EBITDA amounted to ISK 780 million, a decrease by ISK 23 million from previous year. EBITDA adjusted for one off items amounted to ISK 798 million, a 17% decrease from previous year.

       ·      EBITDA for the year amounted to ISK 3,248 million, a 4% increase from previous year. EBITDA adjusted for one off items in relation to the acquisition amounted to ISK 3,417 million, a 2% increase from the previous year.

       ·      Profit in the period amounted to ISK 195 million, a decrease of 45% from the previous year.

       ·      The year`s profit amounted to ISK 473 million, a 56% decrease from previous year. Profit adjusted for one off items in relation to the acquisition amounted to ISK 608 million, a 52% decrease from the previous year. 

       ·      Profit per share was ISK 1.6 for the year.

       · The years investment activities amounted to ISK 2,407 million, an increase of 45% from the previous year. Investment activities as a percentage of revenue was 11.0%, but was 11.7% in 2017.
       · The Board of Directors proposes that no dividend will be paid for the operating year 2018.
       · The EBITDA guidance has been revised downwards by ISK 440 million. Furthermore, the sale of the majority stake of P/F Hey, changes in accounting methods of content rights and implementation of IFRS 16 leads to a revised guidance of ISK 6.0 - 6.5 bn., see graph 5 in press release.
       · changed accounting policies used in the handling of the exhibit and the implementation of IFRS 16.
       

       

Stefán Sigurðsson, CEO:

"The fourth quarter results mark the first full year of merged company. There are several reasons why the results are lower than our earlier guidance. Firstly, challenging economic conditions have affected sales in both advertising and TV-subscriptions. Secondly, the cost level of the company has been higher than anticipated along with cost increase due to the weakening of the ISK in the fourth quarter. Thirdly, technical difficulties of migrating customers between billing systems around mid-year caused a lot of strain on the company`s service at the same time as the competition in the market increased. This increased churn, sales cost and led to lower ARPU in the fourth quarter. All mentioned challenges have been met with various measures. The service level of the company is back to normal, sales have increased although competition in the market is still fierce. Focus has been put on cost cutting which will continue to have positive effect on the company`s results. At the same time measures will be taken to simplify and improve the corporation`s operations in coming months.

Technical projects related to the merger have mostly been completed and all operations are now situated at the company HQ at Suðurlandsbraut 8-10. The sale of the majority of P/F Hey in the Faroe Islands will simplify the operations. Other projects include construction of Reykjavik first data center partly owned by Sýn. The project has been met with much enthusiasm as the data center will be the one of the most advanced in Iceland. After the merger the company is financially stronger, with more diverse income streams, and numerous future opportunities and therefore well positioned to face challenges in the market and macro environment" says Stefán Sigurðsson CEO, Sýn.

Press Release Q4


This announcement is distributed by West Corporation on behalf of West Corporation clients.

The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Sýn hf. via GlobeNewswire

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