Teleste takes Q3 sales hit but grows revenue
November 6, 2024
Teleste, the Finnish broadband technology provider, has reported that net sales decreased by 15.1 per cent in Q3, amounting to €29.9 million. EBIT stood at 1.3 million, a 160.4 per cent increase on the same quarter last year.
The company estimates that total net sales in 2024 will amount to €120–135 million and that the adjusted operating result in 2024 will be €1–4 million.
Teleste President and CEO, Esa Harju, commented: “Profitability improved in both business units, although orders and revenue decreased compared to the same period last year. The savings measures and prioritisations implemented in the company have been significant, resulting in a substantially lighter cost structure than before. The cash flow from operations was also at a very good level.”
“In the Broadband Networks business unit, the European market demand continued at a low level. It appears, however, that the market decline has now slowed down. There are now initial indications that investments in the next-generation DOCSIS 4.0 technology are commencing in parts of Europe in the latter half of 2025. Delivery volumes in North America continue on the rise. They will however not fully compensate for the reduced volume in Europe this year. We are solidifying our position as a key technology supplier to several North American operators, and volumes are expected to continue to increase during 2025 and 2026. The rise may involve seasonal variations depending on the timing of orders and deliveries.”
“In the Public Safety and Mobility business unit, several important projects have advanced to the commercialisation stage, and large project deliveries are scheduled for the end of the year. The largest project volumes are still for train manufacturers, but we are also advancing new projects in the area of video security. The share of services and maintenance business is growing, which will provide stabilising volumes for future project cycles. The improvement in business profitability is progressing as planned. We announced on August 30th 2024, that we have signed a €53 million secured syndicated financing agreement with our three partner banks. The financing agreement is for two years and includes two one-year extension options. The financing arrangement supports the implementation of our strategy.”
“We updated our financial guidance in a stock exchange release on September 16th 2024. The main reason for the update was that the European market demand in the Broadband Networks business has continued at a lower level and longer than anticipated. We have continued determined actions to improve cost efficiency and to prioritise operations. The savings measures have affected all company operations. The restructuring of the group’s legal structure, whereby the Broadband Networks and Public Safety and Mobility businesses are carved out into their own legal entities, will be completed by the end of this year,” Harju concluded.