Tecnotree agrees on 6.0 MEUR settlement; creates impairment charge of approx. 8.3 MEUR; 2016 operating result negative
Stock Exhance Release
January 10, 2017 at 6.40 pm
Tecnotree Corporation (“Tecnotree”) reaches a settlement of 6.0 million euros with a Latin American customer on a long-standing overdue receivable. Tecnotree will create an impairment charge of approximately 8.3 million euros for the remaining amount and, as a result, the company’s operating result in 2016 will be negative.
Tecnotree Corporation has reached an amicable settlement of 6.0 million euros with a Latin American operator, also one of its key customers. The settlement ensures that Tecnotree will continue to remain one of the key technology contributors to this customer. The proceeds from the settlement will be used by Tecnotree to reduce its long-term debt.
Following the outcome of the negotiations with the customer, Tecnotree is making a non-recurring impairment charge of approximately 8.3 million euros in Q4 2016. This charge is related to revenues recognised in prior years. This impairment charge has the same financial impact on the full year 2016 operating result.
Tecnotree estimated in its earlier financial releases that its net sales and operating result in 2016 would be clearly lower than in 2015. The company now estimates that its full year 2016 operating result will be clearly negative.
“The settlement is a favourable outcome to a long-standing negotiation, and our business with this customer continues in good co-operation. The recognition of this impairment charge marks the end of the uncertainty related to these receivables. As we have stated before, going forward we continue to ensure that our arrangements with customers are transparent and easy to manage in all areas, including faster payment processes. We are using the settlement amount to reduce our long term debt, which is in the interest of all stake holders,” says Padma Ravichander, Tecnotree CEO.
Tecnotree Corporation plans to publish its Q4 2016 and full year 2016 financial results on February 3, 2017.
For more information
Padma Ravichander, CEO, tel. +97 156 414 1420
Kirsti Parvi, CFO, tel. +358 50 517 4569
Tecnotree is a global provider of telecom IT solutions for the management of products, customers and revenue. Tecnotree helps communications service providers to transform their business towards a marketplace of digital services. Tecnotree empowers service providers to monetise service bundles, provide personalised user experiences and augment value throughout the customer lifecycle. With around 900 telecom experts, Tecnotree serves around 90 service providers in around 70 countries. Tecnotree is listed on the main list of NASDAQ Helsinki with the trading code TEM1V. For more information on Tecnotree, please visit www.tecnotree.com.