The Superloop (ASX:SLC) share price slides on FY21 earnings

The Superloop share price has had a tough run and its full year results aren’t helping.
The post The Superloop (ASX:SLC) share price slides on FY21 earnings appeared first on The Motley Fool Australia. –

The Superloop Ltd (ASX: SLC) share price is slipping today following the release of the company’s results for financial year 2021 (FY21).

Right now, the Superloop share price is 93 cents, 4.62% lower than its previous close.

Superloop share price slumps on dropped dividend

Here’s how the telecommunications services company performed over FY21:

Earnings before interest, tax, depreciation, and amortisation (EBITDA) of $18.2 million, excluding acquisition costs. Up 34% on those of FY20.
Loss of $31.9 million – that’s 22% better than Superloop’s FY20 loss
$110.7 million in total revenue
Operating cash flows of $15.1 million
No dividend

The company’s underlying EBITDA was $17.5 million – a 108% increase on that of FY20.

Of the company’s revenue, $62.4 million came from its connectivity segment. That segment includes Superloop’s fibre infrastructure and high-performance network solution businesses and its fixed wireless wholesale and corporate products.

The company’s broadband segment contributed $41.8 million to its bottom line. The broadband segment includes Superloop’s Guest WiFi and Consumer Home Broadband products.

Finally, its services segment, which includes its cyber security and web filtering solution, CyberHound, and non-core cloud managed services, brought in $6.3 million.

Superloop also received JobKeeper during FY21. Further, its operating expenditure was reduced by 17% and its capital expenditure remained stable at $14.6 million.

Superloop ended the period with $89.7 million in cash with $62.5 million in interest-bearing loans and borrowings.

What happened in FY21 for Superloop?

FY21 was a productive year for Superloop and its share price.

The company’s Consumer Home Broadband products saw a 62% growth in subscribers.

Superloop also completed a $100 million equity raise. The funds went towards its acquisition of Exetel which it completed earlier this month.

It also refinanced its debt. By doing so, Superloop increased its debt facility to $92.2 million with more favourable terms.

Finally, Superloop’s student accommodation and hotel clients were hit hard by COVID-19. As a result, Superloop’s Guest Wifi platform struggled through FY21.

What did management say?

Superloop’s remuneration and nomination committee’s chair Tony Clark commented on the news driving the company’s share price downwards today:

For Superloop, FY21 was a year where many highlights were realised whilst we continued to face the ongoing challenge presented by COVID-19.

What’s next for Superloop?

Here’s how Superloop plans to boost its share price in FY22:

According to Superloop, it’s going to focus on boosting growth and monetising its network assets in the near term.

It believes the speed at which it can achieve revenue growth is a key factor of the market’s valuation of the company.

The company says it will be working to target larger markets, win and retain more businesses, consider mergers and acquisitions, and increase its sales.

Superloop states growth and transmission and storage of data should underpin demand for its services in the Asia Pacific region.

It will also be simplifying its operating platform and maintaining a strong and flexible balance sheet.

Superloop share price snapshot

Today’s fall included, the Superloop share price has dropped 11% year to date. It has also fallen 18.7% since this time last year.

The post The Superloop (ASX:SLC) share price slides on FY21 earnings appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended SUPERLOOP FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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