NTL to cut off 15,000 customers

THE cable firm NTL plans to cut off 15,000 customer from its television service in the next six months as part of a campaign to crack down on subscribers who fail to pay to time.

NTL said earlier this year it had identified thousands of customers consistently not paying their cable bills and that it would act swiftly to disconnect them. During the last three months NTL cut off around 12,000 subscribers.

NTL Ireland chief executive Graeme Sutherland said this was an appropriate policy and would result in customers paying on time and improving the company’s business.

Second quarter results from the cable firm yesterday showed a continuing improvement in its finances. The company saw revenues for the three months to end of June rise by 25% to €26.1 million, while profits were ahead by 33% to €7.94m.

The company said only a about a third of the increase in revenue was from the price hike it received in January with the remainder coming from business customers and digital television subscribers.

Mr Sutherland said the performance was impressive with 8,500 new digital television users added during the three months.

“That’s more than Sky added during the same period, so we’re pleased with that,” he said.

NTL Ireland ended the quarter with approximately 362,400 customers. Digital TV customers grew by approximately 8,500 to 53,300. The business division continued to gain market share with revenues increasing by 24% year over year.

The average revenue it receives per customer showed a strong increase from €15.77 per month to €20 per month, reflecting the increase in customers switching to the digital service.

Meanwhile, NTL’s founder Barclay Knapp has signalled his intention to resign by appointing Simon Duffy as chief executive. Mr Duffy will take over the helm next year. Mr Knapp, who created the business in 1993 and developed it into the biggest cable provider in Britain through a series of acquisitions, will receive a pay-off of three year’s salary worth close to €2m.

NTL reported a 38% drop in its second quarter net loss to €225m, helped by sharply lower interest payments following a €9.7 billion debt-for-equity swap last year.

The company said it would have to pursue further financing alternatives to cut its high interest debt across the board, amid reports of a potential refinancing by issuing shares. Debt now stands at €5.3bn, compared with NTL’s market capitalisation of €1.7bn.

NTL also reported a small rise in second-quarter group revenue to €784m, €4m ahead of its own forecast, while adding 40,000 customers.