Released: 12/05/2009
com:20090512:RnsL0662S
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RNS Number : 0662S
Spiritel PLC
12 May 2009
12 May 2009
SPIRITEL PLC
("SpiriTel" or "the Company")
CONTRACT WIN AND TRADING UPDATE
SpiriTel Plc, (AIM:STP), the business communications service provider, is
pleased to announce that it has signed a contract to provide network services to
one of the world's largest international hotel chains across its UK estate and
is providing a trading update for the year ended 30 April 2009.
Contract win
The Company's Business Division has secured a 30 month contract with a major
international hotel chain for the provision of network services across the whole
of their UK estate. This agreement is expected to be worth in excess of £4
million over its term and is SpiriTel's largest customer contract to date. It is
representative of SpiriTel's successful strategy of driving organic growth by
cross-selling the Company's expanded product range covering fixed, mobile, data
and networking services. An important part of the strategy is to increase future
earnings visibility and the extended term of the new contract win further
contributes to this goal.
Trading update
Due to declining profitability in SpiriTel's Technologies Division during the
second half of the year, as competitive pressure in wholesale markets has
intensified, the Board now expects the Company's results for the year ended 30
April 2009 to be marginally below Board expectations. The Technologies Division
provides the Company's other division - Business - with the infrastructure
support for its direct B2B sales. It also services other third party carrier
customers and it is this revenue stream that has come under pressure. The
Business Division has performed strongly during the year and has secured a
number of notable contract wins, demonstrating the value of the Company's fully
integrated product offering.
Outlook
As the signing of the contract announced today shows, SpiriTel is benefiting
from the breadth of its product offering and the ability to successfully cross
sell its products. As a result, the Business Division continues to deliver
ongoing organic growth. However, competitive pressures experienced by the
Technologies Division are continuing to negatively impact the Company's overall
trading performance.
Alastair Mills, CEO of SpiriTel commented: "This contract win provides further
evidence of the Company's record of driving organic growth by cross-selling an
expanded product range. In the last year this strategic focus on cross-selling
has resulted in total contract wins of over £7 million. The margin pressure in
wholesale markets illustrates the rationale behind our strategy to reduce
exposure to these volatile markets by growing our Business Division."
For further information please visit www.spiritelplc.com or contact:
SpiriTel plc Tavistock Communications FinnCap
Alastair Mills Simon Hudson Geoff Nash
Chief Executive Duncan McCormick Marc Young
Tel: 020 7160 0100 Tel: 020 7920 3150 Tel: 020 7600 1658
Notes to Editors
SpiriTel is a business communications group which is taking advantage of the
opportunities created by rapidly changing telecoms markets in the UK as the
migration to Internet Protocol (IP) based services accelerates. The Group is a
consolidator of the highly fragmented UK telecoms reseller market and is
building a substantial customer base and scale through selective
earnings-enhancing acquisitions. We are organised into two divisions, SpiriTel
Technologies - focused on our infrastructure and IP products and services - and
SpiriTel Business, which provides our fully integrated range of voice and data
services direct to business customers.
Today, the Group offers a broad range of voice and data communications products
and services to a customer base of small and medium sized enterprises and an
increasing number of larger national and international organisations. We are a
recognised leader in the provision of new, but proven, Voice over IP (VoIP)
solutions that are firmly based on the old-fashioned service values which run
throughout the Group.
This information is provided by RNS
The company news service from the London Stock Exchange
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