Virgin Media sees customer gains, upgrades bolster its first quarter results

26 Apr 2012

On the back of a high-profile media campaign, British cableco Virgin Media has revealed that in the first three months of 2012 it saw net cable customer additions of 21,200, an increase it said was also bolstered by improved churn. For the quarter ended 31 March 2012 the operator noted in particular that gross disconnections fell year-on-year for the second quarter in a row, and to the lowest number since the first quarter of 2010; on a percentage basis, it reported monthly churn as being flat at 1.2%.

Alongside the customer gains, Virgin also highlighted the increasing numbers of its customers which were taking up higher speed broadband services, with around half of the cableco’s new subscribers reportedly now opting for a connection offering downlink speeds of 30Mbps or more. In 1Q12 Virgin said that 146,700 either upgraded or took out a 30Mbps or higher service, taking the total to almost 850,000, more than triple the number of customers on such speeds a year earlier. Virgin also noted that that number also included more than 250,000 subscribers which had opted for its 50Mbps, 60Mbps or 100Mbps options.

In terms of the speeds available to its customers, Virgin also confirmed that it has completed the rollout of 100Mbps across its entire network ahead of schedule, with work understood to have been completed at end-March 2012. Further, it reiterated that its 18-month project which aims to double the broadband speeds of over four million customers is now underway, with it saying that as at 24 April 2012 it had doubled the speeds of approximately 250,000 customers, representing around 6% of its cable broadband base.

Financially, meanwhile, the cableco had a solid first quarter, recording total revenues of GBP1.01 billion (USD1.7 billion) in the first three months of 2012, up from GBP982 million in the corresponding period a year earlier. Operating income for the quarter increased by 18% to GBP131 million, mainly due to reduced amortisation expense, while net income stood at GBP7 million in 1Q12, up from GBP3.3 million in 1Q11, with the improvement ‘mainly due to increased operating income, increased gain on derivative instruments, reduced amortisation expense and reduced interest expense, partially offset by increased loss on extinguishment of debt’.

United Kingdom, Virgin Media