Virgin Media profitable after five years
Virgin Media generated its first annual profit in the five years since its formation in 2011, as growing cable and broadband subscriptions offset declining mobile phone sales.
The UK cable firm generated profit of £75.9 million (€90.5 million) in 2011, compared to a loss of £141.1 million in 2010, on revenue of £3.9 billion. The only black mark on the firm’s year is its mobile business, where revenues dipped marginally (1.3%) to £552 .9 million as prepay sales fell and regulated mobile termination rate (MTE) cuts took effect.
Virgin Media estimates the MTR reduction hit its mobile sales to the tune of £21 million over the full year. However, mobile contract sales grew, and chief executive Neil Berkett notes the firm is tapping potential new customers by incorporating mobile into its cable contracts.
Rising subscriber numbers in the firm’s other business units fueled the annual sales rise. Berkett notes an on-demand TV service offered in conjunction with TiVo has already garnered nearly half a million users since its launch mid-2011, while the number of superfast broadband subscribers is up 579,000 over 2010.
“Our strategy of focusing on customers who want more from the digital world is paying off,” Berkett declares.