Telecomunicazioni
Sýn hf.: Making a good company better
Sýn hf.'s Consolidated Financial Statement for the year 2021 was approved by the board on February 16 , 2022.
Main results:
Heiðar Guðjónsson, CEO:
“Our strategic review from the summer of 2019 has proven its worth. We changed our focus from being engineer driven to being customer centric. With that our operating loss of around 100 million per month has turned into a profit of 100 million per month. At the same time, we transformed the balance sheet by paying down long-term debt by 4 billion ISK and realizing a profit of the sale of assets of 6.5 billion. This we achieved in the midst of a global pandemic where roaming revenues disappeared, advertising revenues collapsed, and the depreciation of the Icelandic krona raised our vendor prices considerably.
To increase the flexibility of the company we have renegotiated contracts with most of our vendors. We found ourselves in a position where we had variable revenues but fixed costs, which hurt us in 2019 when customers were leaving us, and we decided to simplify the business and a significant milestone was achieved on December 14th when we sold passive infrastructure from our mobile network. We are preparing further sale of infrastructure which is in line with our strategic review.
Our business has less risk now since a bigger part of our costs has been changed to being variable instead of fixed and fluctuates with revenue. The business is also more profitable. Our key tool in managing the business has been analysing profit margins for every line of business and every product. This powerful tool provides key support in all decision making and we will not operate any part of our business unless it brings sufficient margin.
We are bringing in new revenue streams in the form of podcasts, putting parts of our web portal visir.is behind a paywall and going into credit card acquiring for companies. Today we operate the largest media in Iceland, visir.is, which has over 200 thousand daily users. We count roughly half of households and half of companies as subscribers. This big customer base means we can develop our product offering further. Therein lie the biggest opportunities for the business, taking the strategic review into account.
The long-term development in telecommunications is favourable to us. An increasing number of employees work from home which means more and more employers pay for their mobile and internet bills. The Icelandic workforce is around 200 thousand people and including families that number covers most of the inhabitants. Cyber threats are increasing, and it is a fact that companies cannot trust just anyone for the digital connections which go straight to the heart of the company. Our collaboration with Vodafone Group is very important in this regard since they survey over 40 billion cyber events every month. We have a ISO27001 security certification and with a very strong presence in the enterprise business we can play offense on the telecom market for years to come.
The future of telecommunications as we see it today is less about the consumer and more about the Internet of Things, where machines are directly connected without any human touch. We are dominant in this field in Iceland. We have issued more than three times as many IoT cards from Vodafone Iceland as there are inhabitants, which is a world record. There should be good growth in this field for the foreseeable future. We have held back on the rollout of 5G since the Telecom Act has still not been passed, after 3 years in Althingi. Our focus has been on IoT infrastructure in the meantime.
Our media business has a promising future. We have repositioned Stöð 2 and put local content first, SVOD first and OTT first. This is a big change for the future, and we are optimistic this will bring new customers. We are also reviewing our radio business and are focusing more on OTT which supports better podcasts and other forms since the difference between audio books, podcasts and radio is becoming less and less clear.
Our customer satisfaction (NPS) has never been higher and the same holds true for employee satisfaction. We have together succeeded in making a good company better.”
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