Meteor drives eircom’s profits in year to June

28 Aug 2007

Irish former monopoly eircom today announced its quarter and twelve months results for the financial period ending 30 June 2007, bringing its reporting periods in line with its majority shareholder Babcock and Brown Capital. The operator reported underlying profits (EBITDA) of EUR655 million (USD894 million) for the year to the end of June, up 7% on the same period last year, driven by a strong performance from its mobile arm Meteor Mobile. Revenues for the year to June rose 12% to nearly EUR2 billion. Commenting on the results, eircom chief executive Rex Comb, said, ‘Once again, the group has delivered strong revenue growth and solid results, both in the quarter and for the twelve months to June 2007, against a backdrop of strong competition in all its markets. EBITDA for eircom Group now stands at EUR655 million, an increase of 7% for the year on the back of a strong performance from Meteor. eircom Group revenue for the year is up by EUR200m, or 12%, on the corresponding twelve month period.’

In the fixed line segment, eircom reported strong demand for broadband services. The telco added 195,000 subscribers during the twelve months to end-June, a 75% increase over the previous year, lifting the total number of DSL and bitstream subscribers on its books to 455,000; this number had increased to 479,000 by 16 August 2007, of which eircom’s retail subscribers accounted for 338,000. Comb estimates that the Republic’s broadband growth has accelerated in the first half of 2007 and now stands at 16.2%, compared to an estimated current EU average of 18%. Eircom says it has succeeded in maintaining market share in the fixed line voice and data services segment. Total fixed line access channels increased by 2% year-on-year, even before the growth in DSL lines, while eircom’s retail lines fell by 2% during the period.

In the wireless arena, Meteor’s Mobile increased its subscriber base by 28% to 875,000 in the year to 30 June 2007; post-paid subscribers reached 100,000, up from 57,000 a year ago. The cellco added 43,000 net new subscribers to its base in the last quarter, which it claims was ‘a significantly better performance than any of the other mobile operators in Ireland’. Meteor recorded EBITDA of EUR24 million for the quarter ended 30 June 2007, up from EUR13 million for the corresponding period of 2006, reflecting increased revenues offset by higher cost of sales.

Speaking on RTÉ Radio’s Morning Ireland, Mr Comb said there have been ‘numerous expressions of interest’ in the proposed sale of Eircom’s mast network. However, he insisted the company’s board has not made a final decision on the matter yet.

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