Netgem TV subs rise 33%
February 1, 2024
Netgem announces revenues of €35.6 million and a gross profit of €22 million for FY 2023. Recurring revenues for FY 2023 amounted to €22.3 million, up 55 per cent compared to the previous year. Netgem attributes the growth of its subscriber base (up 33 per cent) to Telecom activities and by the integration of the Eclair companies.
Non-recurring revenues, which include in particular the sale of Boxes and service activation fees, are down as anticipated due to the exit from Hardware activities and the switch to Android technology.
The recurring activity had a gross margin rate significantly higher than that of the non-recurring activity, ultimately resulting in a 10 per cent growth in gross profit and a 7 points gain in growth margin rate, increasing from 55 per cent to 62 per cent.
Netgem notes that if the increase in recurring revenues, a growth driver for the future, did not fully offset the
expected decline in non-recurring revenues in FY 2023, the embedded growth is on a positive trajectory, as evidenced by the subscriber base growth.
Netgem concludes 2023 with a base of 677,000 netgem.tv subscribers (an aforementioned rise of 33 per cent), managed on behalf of around twenty fixed telecommunication operators in Europe.
The newly acquired Eclair activities in July 2023 contributed €2.5 million to revenues in the second half, including €1.3 million in recurring revenues. As of the end of December, the group’s gross cash position stood at €6.6 million.
Outlook 2024
Netgem anticipates a growth of approximately 10 per cent in its recurring revenues in 2024. This growth will be supported by the entire group’s activities, both in France and internationally, particularly driven by the prospects of gaining new operator customers through the new products launched in 2023 in the fields of cloud gaming and FAST channels targeting telecom operators. Additionally, the group expects to acquire new media customers through the business units Eclair Preservation by Netgem and Eclair Valorisation by Netgem, which provide services to content publishers.
The group also intends to continue simplifying its organisation, especially following the changes in scope in 2023, leading to a reduction in its overhead costs in 2024. As a result, the group expects to improve its profitability and cash flow generation indicators in 2024.
Mathias Hautefort, CEO of Netgem, commmented: “Our growth in 2024 is now driven by three key engines: our Media Services division, serving content publishers, our longstanding activity targeting telecom operators in France, and our international expansion, strengthened by our new products in the areas of cloud gaming and FAST channels.”