Eircom revenues decrease by 6%

Eircom’s revenues fell by 6%, year-on-year, in the first nine months of its current financial year, with underlying earnings down by 1%.

The former State-owned telecommunications group — which last month announced it was actively exploring strategic options for its future ownership structure — yesterday reported underlying EBITDA (earnings before interest, tax, depreciation and amortisation) of €119 million for its third quarter; the three months to the end of March. This was flat when measured on a year-on-year basis, but the nine-month earnings figure of €352m marked a 1% annualised dip.

Third quarter revenue was down by 5%, year-on-year, at €315m (with prior year comparisons altered to allow for the sale of the Phonewatch business); with the nine-month revenue falling by 6% to €972m.

While cost cut progress continues, the company did incur a €10m one-off cost, related to necessary network repairs after the storms seen in January and February.

Chief financial officer Richard Moat said that the third-quarter performance was broadly in line with management’s expectations and showed “continued stabilisation in business performance”.

“The quality of the customer base [customer numbers grew year-on-year across mobile, wholesale and broadband] also continues to improve and, as of March 31, 39% of our base comprised of postpaid customers, an increase from 31% in the prior year.”

Mr Moat also said that the strategic options exploration — Goldman Sachs and Morgan Stanley are advising on a number of avenues which could include a stock market flotation (which would be a third for the company in 15 years) or a trade sale — is ongoing and only in its early stages.

Eircom also welcomed the news that the EU has approved Three’s takeover of O2 Ireland (although ComReg, here, still has reservations), saying it is “good for the industry and good for consumers”. However, a future network-sharing agreement (Three has one with Vodafone and Eircom has had one in place with O2) remains subject to discussions, the company stated.

Eircom added its 4G roll-out has reached 50% population coverage ahead of schedule and it is on track to pass the one million premises fibre footprint target by this summer and to hit 1.4 million by 2016.