GTT to boost sales team to push growth back up after Hibernia deal
04 August 2017 | Alan Burkitt-Gray
GTT is to increase its sales force by 50% by the middle of 2018, president and CEO Rick Calder said following the publication of the company’s second-quarter results yesterday.
The intention is to push growth and margins back up to GTT’s normal level following an expected decline due to the acquisition of Hibernia Networks, completed at the beginning of 2017, and of Global Capacity, announced in June.
“The target is to grow at 10%-plus,” said Calder in a conference call about the results. “We’ll have lower growth following the acquisition of Hibernia, around 9%. But we still expect to get to 10-20%. We’ll get it up to the higher 20s.”
Gross margins should go up too, forecast Calder. “We have an aggressive sales plan, but our sales force is too small right now.” He wants to increase the sales team from 135 now to 200 by the middle of next year, he said, and GTT will also increase the support team.
“This is a unique opportunity for us to hire and for reps to join us,” he added. “We are focusing on representatives and support resources to ensure we can continue to grow at double-digit rates. The hiring environment for us has never been stronger.”
Meanwhile GTT is continuing to explore further acquisitions, but he gave no details. “The funnel is very strong,” said Calder.
Founder and chairman Brian Thompson echoed Calder’s words in the conference call. “We’re able to get the world-class folks we need to build this [company] into a multi-billion dollar industry,” he said.
In the results for the quarter ended 30 June, GTT said revenues were $186.2 million, 44.4% over the second quarter of 2016 and 2.1% over the first quarter of 2017.
Adjusted EBITDA was $53.8 million, 77.7% up on the same quarter last year, and 6.0% up on the first quarter of this year.
Taking Hibernia’s figures into account, revenue grew 9.2% and adjusted EBITDA grew 22.7% over the second quarter of 2016. The figures were up 1.7% and 5.9% respectively on the first quarter of 2017.
“GTT delivered another solid quarter of growth and margin expansion,” said Calder. “We are executing our growth strategy both through selective acquisitions and the expansion of our new divisions in enterprise, carrier and EMEA.”