Tiscali 2014 Annual Report Download - page 133

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
-
Annual Report as at 31
December 2014
133
 action aimed at reducing costs and rationalising the internal process for the purpose of
improving profitability;
 the strategy for control of the incoming customer base and debt collection. As at 31 December
2014, the customers using automatic payment methods reached around 67% of total
customers.
Highlights for the year 2014 reveal the following in particular:
 a drop in Group revenues of 4.7% with respect to the same figure in 2013, mainly attributable to
the decrease in Access revenues (-5.3%), and in particular the ADSL and VOIP component, in
turn linked - to a predominant extent - to the reduction of the ARPU caused by additional
promotions on the prices of services when compared with 2013, in an increasingly competitive
market context, and a slight drop in the customer base (-3.4%).
 an increase in the mobile telephone customer base (active and operating SIMs as at 31
December 2014 amounting to around 91,699, with average monthly growth of around 6,700
units);
 an increase of 5.4% in business-to-business revenues (VPN, housing, domains and leased
lines) compared with the previous year;
 focus on innovation through a new strategy for the development of web and Over-the-Top
services.
All the activities listed above made it possible to generate cash and cash equivalents from operating
activities for around EUR 34.1 million.
Furthermore, Tiscali took part in 2014 in the tender called by Consip S.p.A. (hereinafter also
“CONSIP”) for the supply of connectivity services in favour of the Public Administration Authorities
(“SPC2 Tender” or “Consip Tender”), and on 14 May 2014 turned out to be the company with the best
economic bid. In the following months, Tiscali’s bid was subject to close examination in terms of
suitability by the CONSIP awarding commission, an examination successfully passed as per the
communication dated 24 December 2014. On said date, CONSIP also invited the other bidders to
adapt their bid to the price list presented by Tiscali. As confirmed by the communication sent by
CONSIP on 17 February 2015, in consideration of the acceptances received, on the basis of the
tender mechanism, Tiscali shall have to carry out the services for a portion of the supply equal to 60%
of the overall maximum amount. The current tender configuration with no more than three awarded
parties also makes it possible to develop important commercial action also on the parties of the Local
Public Administrations. As things stand, the Company is awaiting the completion of the formal controls,
preparatory to the final assignment which is envisaged to take place by the end of the 1st half of 2015.
Given the matters stated above, the Directors - when assessing the existence of the assumption of the
Group as a going-concern in the current macro-economic context and the current competitive
scenario, have identified in the unbalanced equity, financial and economic situation which the Group is
headed into, as shown by the negative consolidated shareholders’ equity for EUR 168.8 million, due to
the negative economic performance over the years and the weight of the considerable indebtedness,
factors which indicate the existence of significant uncertainties.
In this context, since the first few months of 2013, the Tiscali Group launched a negotiation process
aimed at restructuring the senior financial debt on a consensual basis in accordance with the Group
Facilities Agreement (“GFA”) entered into on 2 July 2009 with a number of financers (hereinafter
“Senior Financiers” or “Lenders”), for the purpose of ensuring an equity and financial structure capable
of permitting, over the long-term, the achievement of a balanced economic, equity and financial
situation.