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KeyTech profit rises 15.3%

The KeyTech Group of Companies posted a 15.3 percent jump in full-year profit to $8.3 million compared to $7.2 million for the prior year on investments in associates and reduced operating expenses. Revenue for the year ended March 31, however, fell $6.7 million to $73.9 million as compared to $80.6 million for the prior financial year. “Despite continuing challenges due to the economy, we are pleased to have increased the Company’s profitability,” said KeyTech CEO Lloyd Fray. “The increase in net income is a result of the ongoing efforts of management to improve efficiencies and reduce operating expenses in our subsidiaries in addition to the success of our investments in associates. “Over the past year we have positioned the company well for the future.” He said in the Cayman Islands, KeyTech acquired TeleCayman, which solidified its position in the corporate data market while it continues to expand its fibre footprint and triple play services in the residential market. In April of this year, KeyTech amalgamated Logic Communications and North Rock Communications. “This move sets the foundation for the launch of new and innovative IP products and we will leverage the synergies between the two companies to bring down operating costs and reduce the cost to the consumer,” he said. Mr. Fray continued: “BTC introduced VDSL2 technology to offer customers higher speeds and improved reliability. The VDSL2 project will allow BTC to deliver broadband access download speeds of up to 25 megabits per second to homes and businesses for internet and video streaming. This project will continue in 2013/14. “Regulatory reform is presenting many challenges for KeyTech. We will continue to work with the Regulatory Authority to ensure that our subsidiaries will be able to compete and leverage the new Integrated Class Operating Licenses (ICOLs).” The company said operating revenues for the year were $73.9 million as compared to $80.6 million for the prior year. Operating revenues in 2012/13 declined $6.7 million versus the prior year. Voice and Data Revenues declined a total of $3.3 million over the prior year. Directory revenues have been significantly impacted by the weak economy and are down $0.6 million over the prior year, the company said. Hardware and Software Revenues declined $1.2 million; however, this is offset by reductions in cost of goods sold, the company said. In 2011/12 KeyTech announced its decision to exit the hardware business to focus on core recurring revenues. Other revenues declined $1.6 million which include professional services. Total operating expenses decreased $12.4 million primarily due to reductions in salary expenses and a one-off amortisation expense charge in the prior year. Salaries and employee benefit expenses declined $3.7 million. Staff termination costs were $0.6 million, $2.4 million lower than the prior year. Depreciation and amortisation expenses decreased $5.4 million. Total capital asset expenditure in the current year was $21.6 million compared to $11.7 million in the prior year. This included the purchase of TeleCayman as well as infrastructure build out to increase DSL speeds at BTC and the continuation of the fibre build and IPTV rollout in the Cayman Islands. Share of income of associates for the year were $6.9 million as compared to $3.2 million for the prior year. Profit attributable to shareholders was $8.3 million as compared to $7.2 million for the prior year. Total cash dividends paid to common shareholders for the current and prior year was $0.48 per common share. KeyTech’s basic and fully diluted earnings per common share from continuing operations for the year were $0.572 compared to $0.493 in the prior year. Due to the combined impact of a reduction in both the actuarial discount rate for the defined pension liability and the value of assets held by the defined benefit pension plan for the current year, other comprehensive income changes in the defined benefit plan decreased $1.1 million versus a $2.9 million decrease for the prior year. Investment income was $160,009 as compared to $6,849 for the prior year. Total comprehensive income for the year was $7.4 million compared to $3.7 million for the prior year. The record date for attendance at the 2013 Annual General Meeting is July 1st, 2013. The 2013 Annual General Meeting will be held at 4:00pm on July 26th, 2013.