C&W reports 23pc rise in revenue

22 May 2008

Cable & Wireless (C&W) has reported a 23pc rise in earnings before interest, tax, depreciation and amortisation (EBITDA) to £605m sterling for financial year 2008.

Total operating profit for the year ended 31 March 2008 was up £181m to £284m. Group profit before income tax and exceptionals was up 57pc to £308m.

C&W said that Europe, Asia and US EBITDA before exceptionals more than doubled to £219m.

C&W is recommending a final dividend of 5p per share, making the recommended full year dividend 7.5p per share, an increase of 28pc.

The company is anticipating Europe, Asia & US EBITDA for 2008-2009 of between £285m and £295m, and group EBITDA guidance for 2008-2009 in the range of £702m to £725m. It expects international EBITDA for the year of between US$895m and US$910m.

“We introduced two standalone business units to C&W in 2006. The new structure has brought increased focus to both businesses and we’re pleased to report in 2007-2008 we have passed several important milestones,” said Richard Lapthorne, chairman, C&W.

“In the Europe, Asia and US business, we have returned to revenue growth with over 40pc of revenue now accounted for by IP, data and hosting products. Gross margin is now above 40pc and operating costs are below 30pc of revenue after cost savings of more than £100m achieved in the year.

“As a result, EBITDA more than doubled, and we are now targeting a further increase of 30pc to 35pc for 2008-2009. Most pleasingly of all, we generated trading cash flow for the first time in many years.

“In the international business, we have refocused the business on its drivers of value. We have set our strategy and approach and as a result are targeting growth in EBITDA for 2008/09 of 8pc to 10pc with a margin of 35pc. We expect Macau and Panama to continue to deliver with further improvements in Jamaica.”

By Niall Byrne