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She said that the Georgian tourism sector is ready to host international visitors while maintaining coronavirus regulations.
“The pandemic has affected this sector most. Today we have an opportunity to help revive this sector with proper marketing, targeted programmes and mass vaccination,” she added.
9.2.3 TMT corporate news
Eurobond recall from Georgian internet provider Silknet ‘highly likely in Q2 2022’
Georgian internet provider Silknet’s performance improved considerably in Q2, boosted by a faster than expected recovery of the Georgian economy and a gradual revival of tourism, Galt&Taggart reports.
The company generated GEL 197.8mn (+6.9% y/y) in revenue and GEL 100mn (+4.5% y/y) EBITDA in H1 (excluding IFRS 16). Mobile data continued to drive growth in H1, however favourable results were also seen in other segments. Namely, fixed broadband revenue was up 1.5% y/y, while pay-TV revenue was up 5.0% y/y on the back of increased ARPUs. Notably, Silknet lagged behind Magticom in new customer acquisitions in the fixed broadband and pay TV segments, explained by Magticom’s aggressive strategy to penetrate rural areas.
Despite a strong performance in terms of revenue, the company’s profitability margins slightly deteriorated in H1, with an adjusted EBITDA margin at 53.9% in H1 2021 vs 55.2% in H1 2020. This decline stemmed from increased electricity tariffs, FX-related increases in operating expenses and higher salaries. On a positive note, Silknet’s leverage declined from 2.98x as of Dec-2020 to 2.83x by end June 2021, supported by the GEL’s appreciation against the USD. Notably, from July 1, retail price regulation has been abolished, giving flexibility to existing mobile operators to adjust tariffs when needed.
Silknet’s $200mn eurobond, which is callable from 2 April 2022 (at 105.5%), was trading at 109.06% of par for an YTM of 7.0% as of Sep-21. At this pricing level, it is highly likely that Silknet will recall its eurobonds in Q2 2022.
9.2.4 Metal and mining corporate news
Georgian Manganese invests another $2mn in expanding production
Georgian Manganese has invested another $2mn in expanding its production, according to a July 20 announcement.
The company has recently faced numerous strikes from workers at its mines. In the 4th workshop of the Georgian Manganese Ferroalloy Plant, the overhaul of the 26th furnace has been completed and put into operation.
The furnace will produce 70 tonnes of additional products per day, which will increase the existing production volume to at least 25,000 tonnes, or 10%. The new furnace is to produce $43mn worth of products a year. It took five months to complete the capital work, with a total investment of more than $2mn.
According to the Ministry of Economy, the production process of the new furnace, which has a capacity of 22.5 MW, will be carried out in a semi-closed cycle. Consequently, during the metal release process, no harmful dust is emitted outside. The commissioning of the furnace created an additional 20 jobs.
At the opening of the new furnace, Natia Turnava, Georgia’s Minister of Economy, said that ferroalloys account for almost 10% of the country's local exports. Georgian Manganese employs about 5,000 people in the towns of Zestaponi and Chiatura.
Mine strikes in Georgia’s northwest have become a regular occurrence over
68 GEORGIA Country Report October 2021 www.intellinews.com