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mobilezone reports 6.5 percent increase in operating profit

August 21, 2014

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NEWS RELEASE


Regensdorf, August 22, 2014



mobilezone reports 6.5 percent increase in operating profit



Regensdorf, August 22, 2014 - In an extremely competitive market, mobilezone, Switzerland's largest independent telecom specialist, increased its sales in the first six months of 2014 by19.1 percent to CHF 177.2 million. Operating profit rose to CHF 11.2million, an increase of 6.5 percent.


Despite its competitive market environment, mobilezone increased its sales in the first six months of 2014 by 19.1 percent to CHF 177.2 million (2013: CHF 148.8 million) and achieved an operating profit (EBIT) of CHF 11.2 million (2013: CHF 10.6 million), an increase of 6.5 percent. The growth in sales includes wholesale sales in the segment Trade in the amount of CHF 12.8 million (2013: CHF 0.1 million). If this one-time effect is disregarded, the sales increase amounts to 10.5 percent.


Gross profit grew by 4.6 percent to CHF 54.8 million (2013: CHF 52.4 million). The gross profit margin fell from 35.2 percent to 30.9 percent. This reduction in the gross profit margin is primarily due to wholesale orders at very narrow margins. The company's consolidated profit grew by CHF 0.3 million or 2.9 percent to CHF 9.1 million.


Expanded range of services and products

mobilezone continues to invest in its service organization. In the first six months of 2014 mobilezone opened three new Service Centers in Winterthur (Untertor), Rapperswil (shopping center Sonnenhof), and Lugano (Palazzo Ransila). Overall, in eight selected shops mobilezone offers a broad range of customer services, such as express repairs on-site.

The segment Service Providing added post- and prepaid products of TalkTalk to its offers.

In April of this year mobilezone became the first independent distributor of CoopMobile. With this expansion of its product range, mobilezone continues to offer its customers Switzerland's largest selection of subscription plans for mobile and fixed-line telephony, Internet, and digital TV.

In addition, mobilezone started a buyback program for used mobile phones. Customers benefit on the spot by receiving the cash value of their mobile. Specifically, mobilezone guarantees that it will pay a predetermined fixed price for all fully functional and undamaged iPhone models.


Segment Trade: Significant upturn

After several providers had already discontinued the automatic renewal of mobile phone plans in 2013, Orange and Sunrise followed suit at the beginning of 2014. This fact and the introduction of the Freedom plans by Sunrise measurably revitalized the market in the first six months of this fiscal year. With the Freedom plans customers can sign up for a contract without a minimum term; that is, they can cancel it any time.


Share buyback for capital reduction

As decided at the General Meeting on April 9, 2014, the share buyback of 3,577,299 bearer shares at the fixed price of CHF 10.00 per share was carried out between April 11, 2014, and April 24, 2014. The destruction of these shares for the purpose of capital reduction will be proposed at the next General Meeting on April 9, 2015. As a result, the profit-per-share ratio of bearer shares will increase by 10 percent.



Key figures of mobilezone Group




Million CHF



Jan. - June 2014



Jan. - June 2013





Net sales



177.2



148.8





Gross profit



54.8



52.4





as % of net sales



30.9 %



35.2 %





EBIT *



11.2



10.6





as % of net sales



6.3 %



7.1 %





Consolidated profit



9.1



8.8





as % of net sales



5.1 %



5.9 %





Investments



3.6



2.8















6/30/2014



6/30/2013





Shareholders' equity



14.9



29.6





as % of total assets



15.5 %



30.1 %





Number of full-time employees



845



795





Number of shops



129



132






*CHF 1.4 million of the Group's EBIT (2013: CHF 1.6 million) are not allocated to any segment and remain in the holding company.



Trade




Million CHF



Jan.- June 2014



Jan. - June 2013





Net sales



130.3



118.1





EBIT



5.1



4.7





Investments



1.6



0.9







Service Providing




Million CHF



Jan.- June 2014



Jan. - June 2013





Net sales



48.7



32.2





EBIT



4.7



4.2





Investments



2.0



1.9







Outlook for the second half of 2014: Excellent starting position

Regarding fiscal year 2014 as a whole, mobilezone is confident and optimistic. For the second half of the year, mobilezone expects two new Apple iPhones; based on previous experience, they are sure to boost the number of contracts, provided they are readily available. Moreover, the expanded range of products and services offered will have an additional positive effect on the course of business in this fiscal year.


As Markus Bernhard, CEO of mobilezone, commented: "We're eagerly awaiting the arrival of the new Apple and Samsung models in the next few weeks. We have also introduced a new buyback program and now buy back used mobile phones from our customers at extremely attractive prices. This too is sure to bring more customers into our shops in the second half of 2014."


The semi-annual report, including the detailed semi-annual financial statements prepared in accordance with Swiss GAAP FER, is now available at http://www.mobilezone.ch/uber-uns/investors--en/financial-reports.



For additional information please contact:


Markus Bernhard

Chief Executive Officer

mobilezone holding ag


043 388 77 66

markus.bernhard@mobilezone.ch


About mobilezone

Established in 1999, mobilezone holding ag (stock ticker symbol SIX: MOB) achieved sales of CHF 328.2 million and a consolidated profit of CHF 22.0 million in fiscal year 2013 and is Switzerland's leading independent telecom specialist.


The mobilezone Group employs a staff of more than 800 employees in its locations in Regensdorf, UrnÄsch, Zweidlen, Zug, and Vienna as well as in 129 shops all across Switzerland. In addition to the complete product line of mobile phones as well as subscription plans of all major providers for mobile phones, digital TV, fixed-line telephony, and Internet, mobilezone offers independent advice and services for individual and business customers as well as repair services.






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