Profit warning: Teleste lowers its guidance for 2019

TELESTE CORPORATION   STOCK EXCHANGE RELEASE    2.12.2019    AT 18:45 EET

PROFIT WARNING: TELESTE LOWERS ITS GUIDANCE FOR 2019 

Operators' investments in distributed access architecture have been further delayed compared with previous schedule estimates due to technology transformation. The order backlog for access network products has decreased during the current quarter and, according to our most recent estimates, deliveries of access network products will remain below our previous forecast in 2019. In addition, net sales and operating result forecasts for 2019 have decreased from the previous estimates in network services business area. In video security and information solutions, we have proceeded according to our growth targets, but the growth does not compensate for the reduced demand of cable operators in the fourth quarter.

In the medium and long term, prospects in our business field are still favorable. Teleste continues to implement its strategy with determination. Our strategic main objectives are the leading position in distributed access architecture products in Europe and a significant position in the North American markets. We expect that new investment projects based on distributed access architecture will be launched in Europe and North America in 2020 and accelerate during the second half of the year. As for video security and information solutions, we still expect significant growth and profit improvement and we are aiming for a leading position in public transportation information and security solutions. In network services business area, the main focus is on the development of our operational activities as well as growth in higher added value services.

New guidance for the 2019 outlook

Teleste expects the company's net sales to remain below 2018 net sales (EUR 250.3 million). Adjusted operating result is expected to remain below 2018 operating result (EUR 9.7 million).

Previous guidance for the 2019 outlook

Teleste expects the company's net sales to remain at the level of 2018 (EUR 250.3 million). Adjusted operating result is expected to increase compared with 2018 (EUR 9.7 million).

Teleste offers an integrated product and service portfolio that makes it possible to build and run a better networked society. Our solutions bring television and broadband services to your home, secure your safety in public places and guide your use of public transport. With solid industry experience and drive for innovations, we are a leading international company in broadband, security and information technologies and related services. We connect with our customers through a global network of offices and partners. In 2018, Teleste's net sales reached EUR 250 million and on average it had approximately 1,400 employees. Teleste is listed on Nasdaq Helsinki.

TELESTE CORPORATION

Jukka Rinnevaara

CEO

ADDITIONAL INFORMATION: Jukka Rinnevaara, tel. +358 2 2605 611

DISTRIBUTION:

Nasdaq Helsinki

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