(WEB HOST INDUSTRY REVIEW) — Driven by more than a hundred new customer contracts largely from the financial services and trading sectors, European networking solutions provider euNetworks Group Limited (www.euNetworks.com) has earned €14.3 million over the six month period ending June 30, 2009, a 32 percent increase compared to the €10.8 million made in the same period last year.
According to its announcement, euNetworks signed 93 new recurring revenue contracts worth over €9 million, and an additional 24 new customer contracts in the first half of 2009.
“We had a very encouraging half-year, with a sizable number of new customers secured and a strong mandate from existing customers in the form of additional new contracts,” euNetworks executive chairman Noel Meaney said in a statement. “We also achieved a number of noteworthy milestones which should position us well to capitalise on opportunities in the future.”
Along with the increased revenue, euNetworks managed to achieve a significantly better gross margins, rising from 40 percent in the first half of 2008 to 45 percent in 1H09.
Despite its positive revenue results, euNetworks predicts the second half of 2009 will look darker for the European telecommunications sector as budget constraints in both enterprise and wholesale markets are expected to drive spending patterns below historic levels, and price compression will also continue to be high as competitors vie for smaller market opportunities.
These circumstances, however, represent opportunities for euNetworks as potential customers tend to postpone building their own network infrastructure in these conditions; instead, they seek managed bandwidth solutions.
euNetworks chief executive officer Brady Rafuse said in a statement, “Enterprise customers who consume large bandwidth are now looking for greater control over their network infrastructure, focusing on optimising network costs and finding more cost effective solutions to solve their network and business challenges. This change in purchasing behaviour presents a significant opportunity for us to become an alternative provider to incumbent carriers.”
