Mixed Quarterly Results for WeDo

To analyse the quarterly results from Portuguese revenue assurance vendor WeDo Technologies, you need to dig into the consolidated reports of its parent group, Sonaecom. The Sonaecom FY08 Q3 announcement suggested that WeDo had a very mixed quarter, when compared year-on-year to Q3 FY07. WeDo increased its international footprint, with the Portuguese market generating 40% of its revenues. Sales are up by almost half, year on year. Orders for the year to date are up 33% compared to the first three quarters of FY07, and have already surpassed the total taken for the whole of FY07. These orders are in line with current sales, with 60% coming from outside Portugal. According to the announcement, WeDo represents about 70% of its immediate parent company’s service revenues, which means that WeDo’s Q8 revenues are roughly US$14M. However, EBITDA margin is well down year on year, falling from 15.3% to 8.9%. This was blamed on the integration of WeDo’s acquisitions, Cape and Praesidium. However, acquisitions only take so long to integrate, and the reports made no mention of how much the acquisitions have been responsible for driving revenue growth. There is no doubt these additions to WeDo have played an important part in building revenues, especially those earned outside of Portugal. The open question is whether costs can be further reigned in, or whether growth will keep on being paid for with lower margins.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.