Full marks to privately-held (and private equity-backed) 2e2 for not only publicly reporting FY results, but simultaneously issuing its full annual report. There are few quoted companies that manage that feat!
In truth, you shouldn’t be reading too much into the numbers this time round as the integration of Morse (see 2e2 taps into Morse code) only completed at the end of the year, and the deal at its outset near nigh doubled the size of the company. A lot of other stuff has happened in between.
But for the record, group revenues for the year to 31st December finished at £327m, comprising £214m from 2e2’s core businesses (+7%) and £113m from Morse. Morse contributed two-thirds of the Group’s £15m operating profit, implying a 2.4% margin for 2e2 (2009: 6.1%) and 8.7% for Morse. Group operating margin netted out at 4.6%, though the EBITDA margin (ex-nasty bits) was 11.6% (2009: 14.9%).
Financing of course took a heavy toll on interest costs, and despite utilisation of tax losses, 2e2 recorded a net £7.3m loss.
I have to say, I cannot easily divine the operating structure of the new organisation from the annual report, which is more couched in terms of 2e2’s market propositions. But I will be speaking to CEO Terry Burt later this morning and I hope this will help clear the mist from my eyes.
By the way, I’m not sure the 2e2 brand now reflects the way Burt wants to present the group to market (for one thing, it has three propositions). Suggestions on postcards only, please, to …