AGM Statement

RNS Number : 5406N

Bigblu Broadband PLC

21 May 2020

 

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 ("MAR"). Upon the publication of this announcement, the inside information is now considered to be in the public domain for the purposes of MAR.

Bigblu Broadband plc

('BBB' or the 'Company' or the 'Group')

AGM Statement

Continued Organic Growth and Balance Sheet Strength  

Michael Tobin, Chairman of Bigblu Broadband plc (AIM: BBB), a leading provider of alternative fast broadband services, will give the following update on first half trading at the Company's Annual General Meeting to be held at 14.15 today.

H1 Update and Impact of COVID-19

BBB's financial performance has proved to be resilient despite the wider impact of the COVID-19 pandemic on the global business environment. The Group continues to see increased interest from potential customers and maintains a strong balance sheet with significant headroom provided by the revolving credit facilities that are in place with Santander and HSBC.

During the first half of the year our operational model demonstrated high levels of resilience. There was a seamless transition to home working with over 95% of all staff across all our global hubs now working full time from home, enabling the Company to continue servicing existing customers at the same time as converting a growing number of new business leads.

Whilst there is an exciting opportunity before us, it is vital to note that we have not been immune to the wider economic travails caused by COVID-19. During the period we have seen widely fluctuating foreign exchange rates which inevitably has an impact on our business. We have also seen some slippage in new satellite capacity coming on-line from suppliers which is now expected to be fully operational in the next financial year and, given the restrictions imposed by COVID-19, we have experienced some installation delays which has led to an increase in in-flight sales (the period between a new contract being signed and the installation being completed).

In addition, we have taken decisive action to ensure that our business is correctly positioned during this COVID-19 pandemic. These actions include:

· Consolidating some of our regional teams into one location in the UK so as to improve efficiency which has led to a rationalisation of our staff cost base;

· Reviewing all non-essential expenditures within the Company; and

· A slowing down of investment capital expenditure for the duration of the pandemic

Currently, we have not taken advantage of any of the Government schemes introduced as a result of COVID-19.

Overall, the Board continues to have confidence that the continued organic growth and balance sheet strength allied with the actions taken by the Board and underlying improvements in cash generation will enable the Company to meet market expectations for the full year.

Excellent Organic Growth

Notwithstanding the current crisis, the benefits of our global presence has meant that we have seen excellent performance in a number of territories including Australia - where the Company continues to be the largest single connector of new customers to the national NBN satellite broadband scheme, underpinning its consistent market share of over 50% of new subscribers over the last nine months. The Company also continued to perform strongly in Italy, Poland and Greece. Within the UK, Quickline has been selected to lead a £6m Government-backed project to boost rural connectivity in North Yorkshire, England's largest rural county.

Although in-flight sales have increased, we are pleased by the response to our new customer self-installation packages, which has enabled the Company to mitigate some of the installation challenges that have been created by the social distancing restrictions that remain in place.

As at 21 May 2020, total customers were c115k, an increase of approximately 5% since 30 November 2019.

There has been an industry-wide take up of broadband solutions with increased demand for larger data and bandwidth packages as consumers manage both work and home education requirements. We believe that this increased demand will be part of a longer-term trend and, as such, we expect our organic growth in customer numbers to continue into the second half of the year, and beyond - with new and existing customers adopting new products with faster broadband speeds and unlimited download limits. The key to successfully managing this demand will be to ensure that existing capacity constraints are greatly reduced, which we expect will be addressed by new packages we hope to introduce later in the year. 

Our network partners continue to be extremely supportive and are providing increased data allowances for no increase in pricing. Over the longer term we expect this trend to lead to both churn rates decreasing and gross margins and ARPUs improving further, but in the short term, and for the remainder of the financial year, we remain very vigilant. Our bad debt levels have not altered but we continue to monitor them very closely.

The Board is pleased with the way in which the Company has been able to navigate its way through the current environment and believes that the Company is in a strong position to capitalise on the growth potential that is open to it.

Investor Presentation:

The Company will be hosting a presentation through the digital platform Investor Meet Company at 14.30 (BST) this afternoon. Investors can sign up to Investor Meet Company for free and add to meet Bigblu Broadband via the following link https://investormeetcompany.com/bigblu-broadband-plc/register-investor?arc=df6a61c0-adae-4c2c-ba67-142940f0c273

For further information:

Bigblu Broadband Group PLC	www.bbb-plc.com
Andrew Walwyn, Chief Executive Officer Frank Waters, Chief Financial Officer Dom Del Mar, Corporate Development	Via Walbrook PR
finnCap (Nomad and Broker) Marc Milmo / Simon Hicks / Charlie Beeson (Corporate Finance) Tim Redfern / Richard Chambers / Manasa Patil (ECM)	Tel: [phone]
Walbrook PR (PR / IR advisers)	Tel: [phone] or
Nick Rome/Tom Cooper/Nicholas Johnson	[e-mail]

About Bigblu Broadband plc

Bigblu Broadband plc (AIM: BBB), is a leading provider of alternative super-fast broadband solutions throughout Europe and Australia. BBB delivers a portfolio of super-fast wireless broadband products for consumers and businesses unserved or underserved by fibre.

High levels of recurring revenue, increasing economies of scale and Government stimulation of the alternative broadband market in many countries provide a solid foundation for significant organic growth as demand for alternative super-fast broadband services increases around the world. 

Acquisitive and organic growth have enabled BBB to grow rapidly since inception in 2008 during which time the Company has completed 21 acquisitions across nine different countries. It is extremely well positioned to continue growing as it targets customers that are trapped in the 'digital divide' with limited fibre broadband options.

BBB's range of solutions includes satellite, next generation fixed wireless and 4G/5G delivering between 30 Mbps and 150 Mbps for consumers, and up to 1 Gbps for businesses. BBB provides customers ongoing services including hardware supply, installation, pre and post-sale support billings and collections, whilst offering appropriate tariffs depending on each end user requirements.

Importantly, as its core technologies evolve, and more affordable capacity is made available, BBB continues to offer ever-increasing speeds and higher data throughputs to satisfy market demands for 'video-on- demand'. Its alternative broadband offerings present a customer experience that is similar to that offered by wired broadband and the connection can be shared in the normal way with PCs, tablets and smart-phones via a normal wired or wireless router.

 

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