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Eircom profits slump 16pc in full year

Thursday, October 18 12:06:29

Full year core profits at eircom (as measured by EBITDA) slumped by E104 million to E542 million in its full year to the end of June, a fall of 16pc compared to 2011 as it lost customers, it said today.

Revenue for the full year through 30 June 2012 declined to E1.515 billion, down E174m or 10pc on the previous year while its continued focus on costs saw an annualised savings of E69 million, down 7pc on the previous year.

But details of the group's accounts were more difficult to find as eircom Group no longer has a public requirement to report on its performance with the same level of detail as in previous results announcements.

That's because Eircom was taken over by its lenders earlier this year following an examinership process that came perilously close to sinking the company.

Herb Hribar was appointed as chief executive in August.

"The performance of the business continues to decline, but this was in line with our expectations. We must do more to retain our customers, stabilise our revenues and grow our profitability. I am determined to execute the business plan, arrest the decline and position the organisation for future growth, so eircom can remain a vibrant and strategic stakeholder in the Irish corporate landscape," said its new CEO today.

He added that the Irish telecoms market is witnessing intense competition from other operators and customers continue to demand better value. "eircom will do more to fight for, retain existing customers and even win back former customers."

In the broadband market, eircom lost 24,000 retail broadband customers in the full year through 30 June 2012, resulting in 461,000 customers, a 5pc reduction of its customer base. The PSTN customer base fell to 999,000, a reduction of 108,000 customers, down 10pc for the year.

In the mobile segment, the Group's customers grew by 4pc to 1,076,000 through the end of the year. This was largely driven by continued strong post-pay growth that resulted in 40,000 net mobile additions and a 5pc improvement in the mix of mobile customers.

As a Group, eircom continues to outperform the market for growth in the more lucrative post-pay segment, through improved value offerings. These factors have also contributed to continued smartphone adoption which now account for 37pc of the total mobile base on 30 June 2012, up from 23pc on 30 June 2011. Revenues continued to decline for the year but the falls were in line with the wider market declines, it said.