Bite Group posts 3.1% drop in Q1′09 EBITDA: our opinion
http://www.WirelessFederation.com posted a new update on the Bite Group, the Baltics telecoms group, declaring a drop of 11.8% in its Q1′09 revenues year-on-year (the Q1 revenues totalled to EUR 46 million). The group EBITDA has reached EUR 7.3 million, a dip of 3.1% as compared to Q1′08. On top, The Lithuanian operation fell by 16.9% to LVL 144.2 million = EUR 41.8 million. (EBITDA for the quarter dipped 12.9% year-on-year, to LVL 36.5 million). The Latvian unit posted Q1 revenues, up 50.2% year-on-year to LVL 23.8 million.
I am terribly sorry about this as we, the founder partners of mmC Group, have a personal fit with the operation as it was one the company to which we were supporting in 2007 both at a stakeholder and an execution level. And I’m sorry about this, because we already informed of this trend in the past and situation doesn’t seem to improve.
We are aware of the different initiatives to increase revenues and ebitda that have been planned and executed but it seems the good results will still have to wait. We specially liked their network coverage expansion plan for 2009 as we think this might contribute to their development. Presently, the coverage is 96% of the Latvian Population. The operator said that they will invest around LVL 6 million in the acquisition and installation of equipment, to complete its network development works in 2010, planing to deploy 3-4 base stations on average per month.
But this is not enough. Movements like the upgrade of its 3G network to HSDPA were also well (and required) movements to remain competitive in the market. The faster 3.5G network is currently available in seven cities across the Baltic State, giving it population coverage of 50%, and supports download speeds of up to 7.2Mbps. Bite’s sister company in neighbouring Lithuania has also been upgraded.
But this is still not enough. Please find next what we think are the most relevant issues affecting the operator (and the market). We really hope Bite to recover and have the presence in the markets it deserves.