Eir hails pivotal year for growth

Eir has hailed a significant milestone in revenues and earnings growth and predicted that questions hanging over its future ownership or plans for an IPO of its shares on stock markets will likely subside for the next few years at least.

Announcing a 4% growth in revenues to over €1.3bn in the year and an underlying 5% increase in Ebitda — earnings before interest, tax, depreciation and amortisation, to €505m, the telecoms firm said it was starting to make inroads into the retail broadband market.

However, it said it continues to talk with the Department of Communications about clarifying the extent of the tender of rural areas to be reached under the National Broadband Plan.

Eir now expects the Government’s tender will likely be ready at the end of this year and awarded by the early summer of next year.

The telecoms firm said it was now hoping that the debt rating agencies would in time upgrade its credit ratings, which would lead to a reduction in the servicing costs of its huge debt pile.

Eir has debts of €2.3bn, including a €700m bond issue and loan of €1.6bn.

Chief executive Richard Moat said there was no sign of “any major change” in its ownership over the next two years.

Eir had cancelled plans for an IPO two years ago.

“The shareholder base looks pretty stable and the shareholders look pretty happy with the progress of the business. Obviously, they are looking at further improvements in future quarters, but I wouldn’t see any major change from this vantage point,” Mr Moat said.

Around 90% of the firm is owned by four large investors, including the New York hedge fund Anchorage Capital, which has a stake of 35%, and GIC — the Singapore wealth fund, which holds 16% of the telecoms firm.

GIC bought into Eir in June, paying €232 per share. Blackstone sold its large stake but is a big lender to the company. Eir estimates it controls 67% of the retail and wholesale broadband market in the Republic.

It said its 34% share of the retail broadband market, which had slipped slightly in the year, was now starting to grow again following its purchase of the rebranded Eir Sport, formerly known as Setanta.

Eir said that Eir Sport was talking to the GAA to potentially extend its coverage of Gaelic sports.