AMM 0.00% 6.2¢ armada metals limited

Small Telcos doing better

  1. 2,070 Posts.
    Small telcos are receiving good reviews from customers (way better than Telstra) and are starting to report much improved quarterly results. Add to this the likelihood of consolidation ie merger/acquisition to gain critical mass and reach and the sector is likely to be strong next year off a very very low base.

    AMM, PWT and QTL will have a much improved year.

    From Comms Day re Amcom:-

    Amcom reports improved results for first quarter
    Amcom Telecommunications has posted an improved first-quarter performance, thanks to lower costs and
    healthy sales from communications contracts with government agencies. The company, which has spent $40 million on its metropolitan data network in Perth, Adelaide, and Darwin, said it posted a net loss of $21,000 in the quarter ended September 30, compared to a forecast loss of $220,000. Sales of $2.74 million in the quarter were 18% higher compared to last year.
    Amcom is sticking to its full-year profit forecast of $600,000 and said it would reap ebitda margins of around 35%, rising to 50% in 2004. The company is predicting full-year sales of $12.5 million and ebitda of about $4.4 million.
    About 43% of the company’s sales are sourced from its government clients, while its partners, such as other
    carriers, system integrators and ISPs, generate 30% of its overall revenues.
    Amcom said its now trying to boost its exposure to the corporate market, which only accounts for around
    15% of sales. Indeed, the company has been funding its expansion from its cash flow until now. It will now use working capital to gain more traction.
    ”Demand for broadband solutions is growing significantly in the niche geographic markets where our
    networks are located,’’ the company said. ”The board has chosen to accelerate sales and earnings growth in
    excess of the existing growth case. This will require increasing the monthly customer installation budget in
    excess of current net operating cash flows. Funding will be provided from existing working capital.’’
    Duncan Craig
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