EBITDA was £1 million, compared with a loss of £1.2 million the previous fiscal year; pre-tax loss fell from £7 million to £3.4 million

June 3, 2004

1 Min Read

BIRMINGHAM, U.K. -- Redstone, the national communications services provider, announces its financial results for theyear ended 31 March 2004.

Financial Highlights:

  • Delivery of profitability and improved margins (excluding exceptional items andgoodwill amortisation)

    • Underlying improvement in gross margins to 32.5% (2003: 26.9%)

    • First time full year EBITDA profit of £1.0m (2003: loss of £1.2m)

    • First time full year pre tax profit of £13,000 (2003: loss of £3.2m)

    • Revenues down 11.8% to £60.7m as a result of continued focus on highermargin enterprise business. Revenue expected to increase from now on

    • Underlying net operating expenses reduced by 7.2% to £20.7m (2003: £22.3m)

  • Cash balances improved by £1.2m to £13.2m (2003: 12.0m) with debt falling to £0.1m

  • Full year pre tax loss of £3.4m (2003: £7.0m)

  • Debtor days improvement from 41 to 32

Operational Highlights

  • Delivery of a complete portfolio of solutions based on strategy outlined in 2001

  • The securing of significant new business wins such as the contracts with CrosswaysAcademy and Tarmac Group each worth over £1m in revenues

  • Continued and significant investment in our sales operation

  • A continued successful business partnership with BT Wholesale and extension of this agreement as announced on 26 May 2004

Ian Brown, Chief Executive, Redstone, commented,"In 2001, we set out a strategy designed to recreate Redstone with a focus on increasedefficiency, cost control, targeted investment and profitable growth. Based on these figures, thatstrategy is gradually delivering results and today, Redstone is in better shape than ever. Withsome improvement in market conditions, a broader portfolio of solutions and an improvingsales operation, we are in a stronger position to deliver profitable growth over the mediumterm."

Redstone Communications Ltd.

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