Eircom and Meteor revenues fall in tough third quarter

27 May 2009

Eircom group’s third-quarter revenues were down 5pc to €488m on the corresponding quarter in 2008, while its Meteor mobile arm saw revenues of €117m decline 2pc on the same quarter in 2008.

The company, which is currently up for sale, with interested parties ranging from France Telecom and Singapore Telecom to Irish entrepreneur Sean Melly, last week appointed former Vodafone Ireland CEO Paul Donovan to the chief executive position.

The company saw 19,000 new DSL broadband subscribers join up, but not as much as the 25,000 yielded during the second quarter and 37,000 during the third quarter – indicating the current economic recession is hurting broadband subscriptions.

The company had net retail PSTN line losses of 24,000, but said this was offset by 9,000 wholesale line gains in the second quarter and 3,000 in the third quarter. By the end of the third quarter, retail PSTN lines stood at 1.24 million, while wholesale lines stood at 317,000.

Meteor revenues were €117m, down 2pc on last year, impacted by declining average revenues per user (ARPU). Mobile subscriber net losses in the third quarter were 8,000, compared with net gains of 13,000 a year ago.

Eircom noted that Meteor launched its mobile broadband 3G network in Dublin and Cork during the past quarter, which, it said, was distinguished by a strong launch, and as of 24 May, some 7,400 customers have signed up, the company said.

Capex outflow was €270m for the nine months to 31 March, which the company said indicates its continued commitment to fixed broadband and 3G rollout.

Eircom also noted in its results that it reached an ‘accord’ with unions this month over a plan to reduce Eircom’s headcount by 1,200 people, as well as introduce a pay freeze and a reduction in allowances.

‘Stage 2’ discussions with the unions are currently underway to agree further cost savings and measures to correct the deficit in Eircom’s pension scheme, the company said.

By John Kennedy