Operating Profits for 2003: Revenue increased by 50% during the second half of fiscal year 2003

Revenue increased by 50% during the second half of fiscal year 2003. There was a onetime charge against operating profits due to a reserve for bad debt in OneTel’s accounts receivable.

Results point back to a successful year in 2003. The business achieved sustained profits. At the same time, expansion was further advanced via the opening of two new subsidiary companies in Belgium and Luxembourg. Through the acquisition of OneTel, the German company has been bolstered, and the framework has been put in place for further expansion in 2004.

The business achieved a revenue of €64.68 million in 2003, just 2% less than in 2002. In the second half of the year the business was able to improve its revenue, due to the acquisition of OneTel, by about 50% over the first two quarters. In so doing, the wholesale business was able to make up for a temporary softening of its margin strength.

The company’s operating profits in its operational business saw a clear improvement. Through the acquisition of OneTel, the annual profit in 2003 was however negatively influenced due to a reserve for bad debt in the amount of €1.78 million on OneTel’s accounts receivable. As a result, 2003’s net income of €1.73 million didn’t improve by 50% as internally planned. Consequently, it nearly obtained the value of the pervious year’s net income of €1.78 million.

Positive growth expected in 2004!

For fiscal year 2004, the board of directors forecast a business volume of €100 million, and stock earnings of €1 per share. Through consolidation with OneTel, revenue will be increased by more than €80 million during this fiscal year. Internal growth is expected to account for approximately 25% of this. This internal increase of revenue should result in organic growth through a restart of the wholesale business and execution of the currently planned measurements.

The forecasted earnings of €10 million are based on 3U’s cost structure, how it was obtained before the 2003’s acquisition of OneTel, and how it will be reached after the integration of OneTel is completed. Expected earnings are at about 10% of the total revenue.

By 31/12/2003 the company had at its disposal liquid and near-liquid assets totalling €55.5 million (circa €6 per stock share). Furthermore, this includes a hidden reserve of almost €4 million in security assets.

It is the board of directors’ aim to use this capital for further acquisitions, which will have a positive impact on profitability. 2003’s annual report is accessible online.

For queries:

Mr. Axel Becker
Tel.: +49 (0)6421 999 – 0
Fax: +49 (0)6421 999 – 1111
E-Mail: ir@3u.net