Arcor profits up 10%; VDSL is next big project

15 Nov 2007

Vodafone Group ‘s German fixed line subsidiary Arcor, the second largest provider after incumbent Deutsche Telekom (DT), has reported a rise in profit in the first half of fiscal year 2007 thanks to continued expansion in the country’s booming broadband market. EBITDA rose 10% year on year to EUR203 million (USD297.6 million) on the back of an 11% increase in sales, to EUR1.13 billion. The main growth driver was Arcor’s DSL business, which reported 2.34 million customers at the end of September, 40% up on the same date last year. Investment in the first six months of its fiscal year, which began in March, totalled EUR138 million, mainly on the expansion of infrastructure, which now passes around 60% of German households. The company expects to reach 66% by March 2008.

Meanwhile Thomson Financial, quoting Arcor CEO Harald Stoeber has reported that the firm is planning to build a nationwide VDSL network. The executive said that the planned investment will run to billions of euros over several years, adding that Arcor was currently negotiating with the incumbent on using facilities it needs to carry out the project. ‘An agreement [with DT] is at hand,’ Stoeber said. DT is currently already building a VDSL network in Germany, and expects to have invested about EUR3 billion (USD4.4 billion) upon completion.