PRESS RELEASE

Ad hoc announcement pursuant to Art. 53 LR

Rotkreuz, March 8, 2024

Markus Bernhard, CEO of the mobilezone Group, is satisfied with the 2023 financial results: "Last year, we were able to further expand our market position by increasing sales volumes in both Germany and Switzerland. With the additional focus on the MVNO business and a sustainably reduced cost base, we increased profitability at EBIT level to 7.0 per cent in the second half of 2023 (H1 2023: 5.9 per cent). This development confirms the strategic course we have consistently pursued."

Telecommunications contracts negotiated (postpaid, internet and TV):

• Switzerland: 462,000 / +5.7 per cent
• Germany: 1,093,000 / +0.2 per cent

Development of MVNO business:

• The number of MVNO (Mobile Virtual Network Operator) subscription customers increased by 40 per cent from 210,500 to 295,300 in the reporting year.
• The EBITDA contribution from MVNOs amounted to CHF 22.7 million (previous year: CHF 16.3 million) or 29.4 per cent (previous year: 20.5 per cent) of the total EBITDA. This totalled CHF 77.2 million (previous year: CHF 79.5 million).

Adjusted for the negative currency effect of CHF 0.9 million (previous year: CHF 2.7 million) and the special effects, EBIT totalled CHF 71.1 million in the reporting year (previous year: CHF 73.3 million).

Financial guidance

The guidance for 2023 and market expectations have been met with EBIT of CHF 65.7 million, despite a further negative currency effect of CHF 0.9 million. 

Key figures in brief 

• Currency-adjusted sales amounted to CHF 1,042 million (+3.9 per cent). Adjusted for acquisitions, organic sales totalled CHF 1,028 million. 70 per cent of consolidated sales of CHF 1,013 million were generated in Germany and 30 per cent in Switzerland (previous year: 69/31 per cent).
• Gross profit totalled CHF 205.4 million (previous year: CHF 201.0 million).
• MVNO sales increased from CHF 48.6 million (including Digital Republic: CHF 4.2 million) to CHF 63.7 million, with organic sales growth of 31 per cent.
• The MVNOs contribution to the EBITDA amounted to CHF 22.7 million (previous year: CHF 16.3 million) or 29.4 per cent (previous year: 20.5 per cent) of the total EBITDA of CHF 77.2 million (previous year: CHF 79.5 million).
• Operating income (EBIT) of CHF 65.7 million (previous year: CHF 70.6 million) with an EBIT margin of 6.5 per cent (previous year: 7.0 per cent), to which Switzerland and Germany contributed 54 per cent and 46 per cent respectively.
• EBIT excluding special effects totalled CHF 71.1 million (previous year: CHF 73.3 million)
  • Negative currency effect of CHF 0.9 million (previous year: CHF 2.7 million).
  • One-off costs of CHF 2.0 million from cost-cutting measures in Germany
  • One-off charge of over CHF 1 million from the insolvency of the OPPO distributor in Switzerland in the 4th quarter.
  • First-time amortisation in Germany of CHF 1.5 million from the launch of the newly developed online platforms and acquisitions made in the first half of the year.
• Financial expenses increased by CHF 3.3 million to CHF 5.2 million (previous year: CHF 1.9 million).
• Tax expenses amounted to CHF 11.4 million and decreased by CHF 2.8 million compared to the previous year (tax rate: 18.7 per cent, previous year: 20.7 per cent).
• Consolidated net income totalled CHF 49.5 million (previous year: CHF 54.5 million).
• Gross cash flow from operating activities totalled CHF 76.9 million (previous year: CHF 79.7 million).
• Net debt increased to CHF 91 million (previous year: CHF 30 million) due to the acquisition of Digital Republic (Switzerland), SIGA exchange and ENO (both Germany) and an increase in net working capital of CHF 40 million.
• The ratio of net debt to EBITDA was 1.18 (previous year: 0.38).
• Equity in the individual financial statements of mobilezone holding ltd totalled CHF 132 million (previous year: CHF 147 million).
• Earnings per share totalled CHF 1.15 (previous year: CHF 1.25).
• The Board of Directors will propose a dividend of CHF 0.90 per registered share to the General Meeting, similar to the previous year.
• The share price was CHF 13.72 on 31 December 2023 compared to CHF 15.32 at the end of December 2022.

Market area Switzerland

Business in Switzerland developed favourably.

• Sales increased from CHF 305 million to CHF 308 million, or 0.9 per cent.
• EBIT amounted to CHF 36.2 million (previous year: CHF 35.5 million), which corresponds to a return on sales of 11.7 per cent (previous year: 11.6 per cent).
• The number of shops totalled 127 (previous year: 124).
• The number of contracts sold (postpaid, Internet and TV) increased by 5.7 per cent to 462,000 (previous year: 437,000).
• Service sales (fleet management, data transfer, setting up smartphones and other services) totalled CHF 7.9 million (previous year: CHF 7.4 million).
• Sales of accessories increased by 2.4 per cent to CHF 25.5 million (previous year: CHF 24.9 million) and accounted for 8.3 per cent (previous year: 8.2 per cent) of sales in Switzerland.
• MVNO revenue from TalkTalk and Digital Republic totalled CHF 33.0 million (previous year: CHF 25.4 million). The number of postpaid subscriptions at the end of 2023 increased by 33 per cent to 149,800 (previous year: 112,500) customers.
• The number of refurbished smartphones sold under the jusit brand increased by 60 per cent.

Market area Germany

Business in Germany clearly improved in the second half of the year after a weaker first half.

• In local currency terms, the German organisation increased sales by 5.9% to EUR 733 million (previous year: EUR 692 million). In the reporting currency CHF, sales rose from CHF 696 million to CHF 708 million, an increase of 1.7%.
• EBIT amounted to EUR 30.8 million (previous year: EUR 35.4 million), which corresponds to a return on sales of 4.2 per cent (previous year: 5.1 per cent). In the reporting currency, EBIT totalled CHF 30.0 million.
• In the online business, 588,000 (previous year: 638,000) mobile phone contracts were negotiated; this corresponds to a decrease of 7.8 per cent.
• The volume in B2B retail increased by 11.5 per cent to 505,000 (previous year: 453,000) mobile phone contracts.
• A total of 1,093,000 (previous year: 1,091,000) mobile contracts were negotiated "online" and in B2B commerce, which corresponds to an increase of 0.2 per cent.
• Sales at MVNO HIGH totalled EUR 31.6 million (previous year: EUR 22.9 million). The postpaid customer base stood at 145,500 (previous year: 98,000) and increased by 48 per cent.

Growth in the Second Life and smartphone refurbishing sector

The Second Life segment, i.e. the repair and refurbishing of smartphones, continues to grow in importance. 4.3 per cent of the total number of smartphones sold by mobilezone in Switzerland were used smartphones (previous year: 2.8 per cent) and were re-introduced to the market as Second Life devices as part of a sustainable device cycle. 12.4 per cent of the total number of smartphones sold were bought back by mobilezone in the shop and online from customers (previous year: 8.3 per cent). In Germany, mobilezone has been selling refurbished devices via Sparhandy since 2022.

Further development of sustainability reporting

mobilezone has a comprehensive sustainability strategy with five focus topics that cover the entire ESG spectrum (environmental, social and governance). In the reporting year, the carbon footprint of the entire Group was calculated for the first time, including emissions from the upstream and downstream supply chain. This was an important step in defining the Group-wide CO₂ targets. The core of the sustainability strategy focuses on five topics:

- Governance and compliance

- Employees

- Customers

- Smartphone cycle

- Environmental management

Sustainability reporting is based on the GRI standards and covers the non-financial reporting requirements stipulated by the Swiss Code of Obligations. The report on non-financial matters in accordance with Art. 964b of the Swiss Code of Obligations will be presented to the General Meeting for the first time on April 3, 2024, as part of a consultative vote. The sustainability report is available at

https://www.mobilezoneholding.ch/en/investors-1/reports-and-presentations.html

Change in the Group Management

As already announced, CEO Markus Bernhard will step down as CEO of the mobilezone Group on June 30, 2024, and will continue to be responsible for the company's strategic development, MVNO business, investor relations and M&A as operational delegate of the Board of Directors. Roger Wassmer (CEO mobilezone Switzerland) and Wilke Stroman (CEO mobilezone Germany) will take over Group Management as Co-CEOs on July 1, 2024.

Dividend and General Meeting

The Board of Directors has decided to slightly adjust the dividend payout ratio to 60 to 80 per cent (previously 60 to 75 per cent) of consolidated net income. The Board of Directors will propose a dividend of CHF 0.90 per registered share at the General Meeting on April 3, 2024, as in the previous year. 55 per cent of the distribution will come from retained earnings and 45 per cent from the reserve from capital contributions, which corresponds to a payout ratio of 79 per cent of consolidated net income. If this proposal is accepted, the dividend will be paid out on April 12, 2024. The share will be traded ex-dividend from April 10, 2024.

Share buyback programme 2022 to 2025

Due to the three acquisitions of Digital Republic, SIGA and ENO in 2023, the share buyback programme will also be suspended in 2024.

Outlook 2024

Demand for telecommunications products remains high among the population. Accordingly, mobilezone is confident about the coming years for all business areas in Germany and Switzerland.

The EBIT forecast for the 2024 financial year is CHF 68 to 75 million. The attractive dividend policy will be continued. In addition, we are still aiming to steadily increase the EBIT margin from 6.5 per cent today to 8.0 per cent in 2025.

For the MVNO business area with TalkTalk, Digital Republic and HIGH, we expect continued strong customer growth in the region of around 20 per cent to over 350,000 customers. We expect the MVNO EBITDA contribution to continue to increase significantly from its current level of 29.4 per cent.

We expect investments excluding customer acquisition costs to decrease from CHF 11.5 million to CHF 10.4 million in 2024. Based on a reduced cost base and increased recurring revenues for 2024, we are very confident that the Group will continue to develop positively.

The Annual Report 2023 with the detailed financial statements in accordance with Swiss GAAP FER is now available at https://www.mobilezoneholding.ch/en/investors-1/reports-and-presentations.html

A video conference for investors, analysts and media representatives will take place today, March 8, 2024, at 9.15 a.m. The online conference will be held in German and participation is possible via the following link: https://www.mobilezoneholding.ch/en/investors-1/videoconference.html

Ad hoc announcement pursuant to Art. 53 LR (PDF)

About mobilezone
Founded in 1999, mobilezone holding ltd is the leading independent Swiss and German telecoms specialist with a turnover of CHF 1.0 billion and a consolidated net income of CHF 49.5 million in the reporting year 2023. The registered shares of mobilezone holding ltd (MOZN) are traded on the SIX Swiss Exchange Ltd.

The mobilezone Group employs around 1,000 people at its sites in Rotkreuz, Urnäsch, Cologne, Bochum and Münster. It offers a complete range of mobile phones and tariff plans for mobile and landline telephony, digital TV and internet from all providers. Independent advice and services for private and business customers, repair services and supplying specialist retailers complete the range. The services and products are offered online via various web portals and in over 125 shops in Switzerland.
www.mobilezoneholding.ch