Positive result as expected
“I am happy to see that we this year can put a number of negative results
behind us and show that RTX Telecom can earn money. This happens in a difficult
macro economical environment. Both of our business units have shown that they
can deliver positive results. Both for products as well as for technology RTX
Telecom is in the lead, and this will contribute to us being on the right
track”, says President & CEO Jesper Mailind.
Today, the Supervisory Board has reviewed and approved the annual report for
RTX Telecom for the financial year 2010/11 for the period 1 October 2010 to 30
With a profit after tax of DKK 3.9 million and a positive net cash flow of DKK
1.0 million marks the financial year 2010/11 a milestone in RTX Telecom's
turnaround. Gross margin improved in 2010/11 due to increased focus on margin
and changes in the product mix. Despite a minor decline in revenue RTX Telecom
can thus present a gross profit, which in the financial year 2010/11 is DKK 4.1
million better than the gross profit for 2009/10. RTX Telecom has in the
financial year 2010/11 increased its cost base in order to invest in new
technologies and product platforms. The aim is to establish attractive product-
and technology platforms which can ensure future business opportunities within
both business units. As a consequence of these investments, both EBIT and cash
flow are at a lower level for the continuing business compared to the previous
financial year. Based on a continued strong solvency and liquidity, RTX Telecom
is in a position to make investments in own financed development.
Summary of the annual report
-- In the financial year 2010/11 the Group achieved total revenue of DKK 204.9
million compared to DKK 220.7 million in the financial year 2009/10.
Revenue thus decreased by 7.1%.
-- The gross profit was improved by DKK 4.1 million, from a gross margin of
51.9% in last financial year to 57.8% in 2010/11.
-- The operating profit (EBIT) amounts to DKK 9.0 million, or 4.4%, compared
to DKK 13.4 million, or 6.1%, for the continuing business in the previous
financial year. The operating profit is thereby in the announced profit
range, which was published by the beginning of the financial year 2010/11
-- The capacity costs increased by DKK 18.0 million, primarily due to
significant investments in new technologies and new product platforms. The
capacity costs include write-down of overdue debtors, which has increased
by DKK 4.3 million compared to the previous financial year.
-- The cash flow amounts to DKK 1.0 million compared to DKK 27.9 million in
the previous financial year. The cash flow was last year positively
affected by sales of short-term current assets of DKK 16.7 million. In
2010/11, the cash flow is negatively affected by larger investments in own
development compared to 2009/10. The Group's cash and short-term current
asset investments amounted to DKK 20.9 million at 30 September 2011, which
is an increase of DKK 1.0 million compared to the same period last
-- The development costs increased with DKK 9.0 million in 2010/11 to DKK 25.7
million. The capitalized costs for new technologies and new product
platforms are DKK 12.3 million (covering four quarters) compared with 2.8
million (covering one quarter) the previous year. Amortization on
development projects in 2010/11 amounted to DKK -0.9 million compared to
DKK 0 million in 2009/10.
-- The Group's equity amounted to DKK 151.9 million at 30 September 2011,
which is an increase of DKK 6.7 million compared to the financial year
-- The discontinued business, which covers the costs associated with the
closure of the former RTX Networks Systems division by the end of the
financial year 2009/10, contributed with a loss of DKK 2.3 million. RTX
Telecom does not expect further costs related to the closing down of RTX
-- The profit after tax amounted to DKK 3.9 million compared to a loss of DKK
15.1 million in the previous financial year.
Prospects for the financial year 2011/12
During the past year, RTX Telecom has invested significantly in new
technologies and product platforms, and has focused on expanding its sales
platform. The Management expects that the increased activity level will
compensate for the general economic softening, resulting in business results
for RTX Telecom slightly over the financial year 2010/11. It is expected that
RTX Technology will be on level with the result for the financial year 2010/11.
RTX Products will produce business results slightly over the previous year with
the improvement focused on second half of the year.
The Management expects to achieve a positive development in Group revenue to a
level between DKK 205-225 million with the improvement mainly related to the
second half of the year. The operating profit (EBIT) is expected to be in the
range of DKK 10-12 million.
The Company's annual report for 2010/11 will be sent to NASDAQ OMX Copenhagen
A/S in continuation of this announcement. Please see the annual report for more
details. The annual report will be available at RTX Telecom's website
Meeting for financial analysts and the press
At 3pm on 1 December 2011, Danske Market Equities will hold a Winter Seminar at
Hotel Mariott Copenhagen, Kalvebod Brygge 5, Copenhagen V. At the meeting RTX
Telecom's Management will comment on the annual report for 2010/11 for the
Group and the Management's expectations for the financial year 2011/12.
Annual general meeting
The Company's annual general meeting will be held on Monday 30 January 2012 at
3pm at RTX Telecom, Stroemmen 6, DK-9400 Noerresundby.
RTX Telecom A/S
Jens Alder Jesper
Chairman President &
Questions and further information:
Jesper Mailind, President & CEO, tel. +45 96 32 23 00
Please visit RTX Telecom's website at: www.rtx.dk