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MNF Group flags $3.5M hit from PennyTel business

MNF Group flags $3.5M hit from PennyTel business

Still closes HY18 with $116.6 million in revenue

MyNetFone co-founder and CEO, Rene Sugo

MyNetFone co-founder and CEO, Rene Sugo

Credit: MNF Group

Telecommunications provider, MNF Group (ASX:MNF), has told shareholders it expects its PennyTel brand to impact its group pre-tax earnings (EBITDA) by $3.5 million in the full 2018 financial year.

According to MNF Group, which owns MyNetFone, PennyTel and Symbio Networks among others, the $3.5 million hit from its PennyTel subsidiary includes $500,000 of costs incurred as part of the launch of the PennyTel MVNO (mobile virtual network operator) on the Telstra network, announced 30 January.

MNF said it will look later to introduce National Broadband Network (NBN) broadband services once the PennyTel brand is established and the NBN rollout has matured and made customer acquisition simpler.

The group said it expects PennyTel to generate positive EBITDA from FY19.

Overall, MNF Group has seen 34 per cent growth in its global wholesale segment, posting revenue of $85.4 million for the segment.

The $21.8 million additional global wholesale revenue was the driver of the group’s revenue which went from $91.4 million in the first half of the 2017 financial year to this year’s $116.6 million.

Consolidated group EBITDA for the six months to 31 December 2017 was $11.9 million, or 19 per cent increase over the prior corresponding year. Net profit after tax (NPAT) was $6.1 million, 25 per cent increase.

The domestic retail segment saw revenue growth of 20 per cent driven by the inclusion of Conference Call International (CCI) for the full half.

MNF Group first announced its intentions to acquire CCI in February 2017 for $18 million. As a result of the merger, MNF gained a portfolio of 5,000 enterprise customers across A/NZ and Asia Pacific, and three brands including Express Virtual Meetings, Ozlink and Eureka Conferencing.

In January 2018, CCI was appointed to the NZ Telecommunications-as-a-Service (TaaS) panel. CCI has been selected to provide audio, web and operator-assisted conferencing services to NZ government agencies under the ‘Communications Tower’, 1 of 5 TaaS ‘service towers’ categories.

The Australia and New Zealand domestic wholesale segment saw a modest revenue growth compared to the same period last year, posting $13.5 million revenue.

MNF Group expects EBITDA of $25 million for the full year and NPAT of $12.5 million.

In late October 2017, MNF Group through its subsidiary, MyNetFone, started to sell BroadSoft unified communication-as-a-service (UCaaS) solution.

MNF integrated Broadsoft business platform BroadCloud into its network, which is run by another MNF subsidiary, Symbio Networks. Symbio operates MNF voice network with a focus of delivering future proof communication solutions.

With the BroadCloud integration we will be able to further expand the service suite to also deliver end-to-end voice solutions,” MNF Group CEO, Rene Sugo, said at the time.


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