Eircom seeks to extend loans

Eircom is looking to change the terms of its existing lending agreements, saying that improving its debt maturity profile is the next step in securing the “sustainable and flexible long-term capital structure” of the business.

The company is hoping to agree with lenders a two-year repayment extension, from September 2017 to the same month in 2019, on €2bn worth of its senior loans.

Yesterday, the former State-owned telecommunications company reported first-half revenues of €657m for the six months to the end of December; a drop of 7% on the same period the previous year.

Revenue for its second quarter showed an annualised decline of 5%, to €334m. However, customer numbers increased on a year-on-year basis, with total broadband numbers up 19,000 to 696,000 and mobile customer numbers rising by the same amount in the six months to just under 1.1m.

Operating costs for the half-year fell by 10% to €424m, with management saying it remains “on track” to achieve its targeted €100m in annualised operational cost savings by the fourth quarter of its current financial year.

“The group generated EBITDA of €233m for the first half of the financial year, which is broadly in line with expectations [albeit down by 1%, year-on -year] and demonstrates continued stabilisation in business performance,” noted Eircom’s chief financial officer, Richard Moat.

“Our programme of cost transformation continues — 1,679 employees have exited the group during the past 12 months. A further 260 employees will leave the business by the end of December 2014. In addition to delivering cost savings, these exits ensure we have a flexible, fit- for-purpose organisation.”

Eircom chief executive Herb Hribar said management remains “fully committed” to addressing competitive challenges through continued investment in the fixed and mobile networks.