eircom Announces First Quarter Results To 30 September 2012
Revenue down 7% for the quarter
Operating costs fall 4%
EBITDA down 10%
Locations Named for Ireland’s Largest Fibre Network
eircom Group today announced results for the first quarter of the financial year to 30 September 2012.
Commenting on today’s announcements, Herb Hribar, CEO eircom Group, said “The performance of the business continues to decline, but the decline is slowing and is in line with our expectations and our business plan. We remain fully committed to our cost reduction targets and believe that the reduction in 2,000 employees is achievable within the two year timeframe.
“The recent launch of our converged broadband and mobile bundle demonstrates our commitment to offer customers real value with innovative new products. Early trading indicates strong customer take up ahead of projections and we plan to continue to retain and win back customers in what is a very competitive telecoms market operating with a difficult economic backdrop.
“We remain fully committed to our investment strategy in high speed broadband across both our fixed and mobile platforms. Together with the rollout of our recently purchased 4G spectrum, we will offer broadband speeds of up to 70Mb to our customers by next summer.
“We are constructing Ireland’s largest fibre broadband network and today I am delighted to announce the locations of the next 300,000 homes and businesses across Ireland that will receive fibre broadband. This phase of the network is scheduled to finish in December 2014 and will reach one million premises. eircom has already reached more than 150,000 premises and it is hoped that the network, which is available to all operators, will deliver services to customers in the first half of next year.”
Revenue for the first quarter through 30 September 2012 declined to €363 million, down €26m or 7% on the corresponding quarter in the previous year. Operating costs were €160m for the quarter, a 4% improvement on the prior year, demonstrating the continued focus on costs savings. Despite these savings, EBITDA decreased by €14 million on the prior year to €124 million for the quarter, down 10% on the same period in 2011. The total customer base stood at 2,058,000 at 30 September 2012 and includes 1,079,000 mobile customers.
In the fixed line segment, revenues fell 7% for the quarter which was reflected in a corresponding 12% decline in fixed line EBITDA compared to the previous year.
In the broadband market, eircom lost 2,000 retail broadband customers for the quarter through 30 September 2012, resulting in 459,000 customers, a 4% reduction of its customer base year on year. The PSTN customer base fell to 979,000, a reduction of 19,000 customers in the quarter, a 9% reduction year on year.
In the mobile segment, the Group’s customers grew by 3% on the prior year to 1,079,000 through the end of September. This was largely driven by continued strong post-pay growth that resulted in 20,000 net mobile additions for the quarter. Mobile revenues continued to decline by 5% for the quarter but mobile EBITDA grew by €2m compared to the previous year.
Commenting on the results, CFO Richard Moat said, “The performance of the business in the first quarter demonstrates why we must aggressively address the costs in our business. We are making some progress slowing our revenue decline and stabilising our overall customer base. Fixed line customer losses are reducing and we continue to outperform the market in the post-pay mobile segment through improved value offerings. However, we must tackle our cost base to ensure that we can offer customers greater value with new high speed broadband bundles and data offerings in 2013 which will help to secure the future of the Group in the medium term.”