eircom grows mobile revenues for third straight quarter, as LTE users take over

eircom said nearly half of its mobile subscribers now have an LTE (4G) compatible device, as it revealed its mobile unit recorded its third straight quarter of revenue growth in the three months to end-December.

The Irish incumbent said the number of subscribers with an LTE device increased by 25 percentage points year-on-year in the final calendar quarter of 2014--the company's fiscal 2015 second quarter. LTE users accounted for 49 per cent of eircom's mobile subscriber base at end-December, compared to 42 per cent on 3G tariffs. In the same period of 2014, LTE accounted for 24 per cent of all subscribers, and 3G 67 per cent. The number of users on 2G tariffs remained the same at 9 per cent.

eircom's mobile business generated revenues of €91 million ($102 million) in its fiscal Q2 2015, on par with the €90 million in fiscal Q2 2014 and up on the €87 million generated in its fiscal Q1 2015. The company improved earnings before interest, depreciation and amortisation (EBITDA) at its mobile unit from €4 million in fiscal Q2 2014 to €9 million in the recent quarter. In the six months to end-December, EBITDA grew from €3 million in fiscal 2014 to €17 million in the current fiscal year.

Customers with an LTE device consume three-times more data than eircom's 3G customers, the operator announced. In addition, smartphone penetration increased from 63 per cent in fiscal Q2 2014 to 71 per cent in the recent quarter.

At a group level, including eircom's fixed line business, revenues declined 18 per cent year on year in fiscal Q2 2015. Group revenue for the six months to end-December was 28 per cent down on fiscal 1H 2014.

Despite the declines, CEO Richard Moat said the group's earnings "are in line with expectations," with the fixed line business stabilising and the mobile unit registering its third consecutive quarter of revenue growth. "A strong Christmas trading performance resulted in the first quarterly growth in the prepay base in over two years," Moat noted.

The operator added 19,000 post pay, and 6,000 prepay subscribers in its fiscal Q2, and said customers opting for bundled TV and mobile services increased by 20 per cent year on year.

For more:
- see eircom's results presentation
- read this related earnings statement

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