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Q3 2006 results

ATM S.A. presented the results for Q3 2006. Revenues from sales exceeded PLN 28.5 million, and net profit amounted to PLN 1.7 million.

After the three quarters of 2006, the revenue from sales exceeded PLN 85.6 million (an 5% increase compared to a corresponding period of last year) and net profit equals PLN 4 million (43% increase). The third quarter of 2006 held important events which will directly influence both the company's market position and revenues.

Q3 2006:

  • Revenues — PLN 28.5 million
  • Net profit — PLN 1.7 million

After third quarter of 2006:

  • Revenues — PLN 85.6 million (5% annual increase)
  • Net profit — PLN 4 million (43 % annual increase)

The most important events of the third quarter of 2006:

  • Foundation of the Cinem@n Sp. z o.o. company
  • Implementation of the MPLS system at Polska Telefonia Cyfrowa sp. z o.o.
  • Closer cooperation with Crowley Data Poland
  • Dynamic development of the ATMAN X-stream service

In August, ATM S.A. and Monolith Films sp. z o.o. signed an agreement on foundation of Cinem@n sp. z o.o. company. In the fourth quarter of 2006, Cinem@n will introduce digital high quality services of movie, information and entertainment content distribution to Polish market. ATM will leverage its experience in building multimedia service platforms and providing high quality IT services, especially taking data transmission into account. The distribution platform will be provided with License and Digital Rights Management (DRM) subsystems to allow only legal access to the distributed content. Monolith’s contribution will be acquisition of attractive content.

Implementation of MPLS system at Polska Telefonia Cyfrowa was also an important event. The Era network operator is a customer of the ATM S.A. company’s telecommunication and integration services for many years. In August 2006, PTC selected ATM’s offer for supply of Cisco hardware for the MPLS technology implementation. ATM S.A. will be developing technical assumptions, delivering and deploying hardware, supporting service migration to the new network and providing post-deployment consultancy and trainings. A portion of traffic currently handled by other solutions will be migrated to the new MPLS core network that will be based on Cisco GSR 12000 routers. For end users this means a faster availability of new generation of services.

Also, the third quarter of 2006 resulted in closer partnership with Crowley Data Poland. In July 2006, both companies have signed an agreement on creating a consortium, which has introduced a service named AC-X to the market. The service is innovative compared to current Internet operations model. It allows to dramatically reduce costs of traffic exchange with other operators and content providers to both sides, and also to other operators connected to the network. The service is directed mainly to Internet service providers, portal owners, and companies planning provision of multimedia services such as internet TV, video on demand or VoIP telephony.

The cooperation with CDP lasts for years and one of the most important cooperative endeavors is participation in an ongoing for over two years tender procedure on provision of IT network to the Polish Ministry of Justice. A recent verdict issued by the district court of Warsaw has settled the litigation in favor of the Crowley, ATM and Exatel consortium. The contract is of a value PLN 82 million. However, the contract has not yet been signed.

ATM has also reported a dynamic development of the ATMAN X-stream service. Thanks to the ATMAN X-stream service offered to the Warsaw City Office, the ATM S.A. company provided an internet transmission from the lightning up of the Miss World 2006 crown symbol ceremony in September 2006. Under this cooperation, ATM also transmitted the accompanying events of the Miss World elections with the finale ceremony held on September 30. In July 2006, using the ATMAN X-stream service, ATM S.A. provided live internet video transmission of a performance of a battle for Polish Security Printing Works, linked with a music event in the New Town Market Square in Warsaw. The performance honored the 62th Anniversary of the breakout of the Warsaw Insurrection. It could be viewed over the Internet by a maximum of 3000 users at a time.

It is worthwhile to mention the acquisition of over 78% of shares of KLK Technologie Informatyczne sp. z o.o., a company from Krakow. The acquisition happened in fourth quarter of 2006, but it will significantly influence future results of the ATM group.

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