mmO2 continues steady growth in UK and Germany, but Irish business stalls

21 Jul 2004

mmO2 saw its customer base expand by 2.9% in its fiscal first quarter, thanks to steady growth at its UK and German businesses. O2 UK, the country’s fourth-largest mobile operator, added 261,000 subscribers – 149,000 of which took post-paid contracts – to boost its customer base to 21.3 million. The growth was attributed to the popularity of new high-end handsets featuring photographic and musical capabilities. Blended average revenue per user (ARPU) for the UK business averaged GBP279 over the twelve months to the end of June, up GBP25 year-on-year. Data usage fell slightly over the quarter, accounting for 21.3% of service revenues over the three months, compared to 22.3% three months earlier, though this was still 3% higher than the figure for 1Q 2003.

In Germany, where O2 is the fifth-ranking operator by subscribers, the cellco reported 336,000 net new customers, 62.2% of which signed up to contract tariffs. Blended twelve month ARPU for O2 Germany’s 6.32 million users was up GBP23 to total GBP252 (EUR367), boosted by an increase in data services; data accounted for 20.9% of service revenues in the quarter, compared to 18.1% a year earlier.

There was little growth at O2 Ireland, the second-largest cellco in the country, with just 4,000 net new additions in the period taking its total base to 1.395 million. Blended twelve month ARPU was down slightly on the previous quarter, but up GBP22 year-on-year to GBP381 (EUR556). Besides its three main subsidiaries, mmO2 also owns the Isle of Man’s Manx Telecom, which had 65,000 cellular customers at the end of June 2004, an increase of 2,000 compared to the previous year. The group said that it was pleased with the results and upped its forecast for annual net service revenue growth in the UK from 5-8% to 7-10%, whilst sticking with its forecasts for growth in Germany ‘in the high teens’.

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