Bouygues loses 379,000 subscribers as competition bites

16 May 2012

French operator Bouygues Telecom lost 379,000 subscribers in the first three months of 2012 due to the increased competition following the launch of low-cost cellular operator Free Mobile on 10 January this year. Contract subscribers accounted for 210,000 of these losses, but the firm says that since mid-March portability requests have gradually been returning to their previous level. There was some good news at Bouygues’ fixed broadband division, which saw 88,000 net customer adds in the three months to 31 March 2012, taking the total to just under 1.33 million.

First quarter sales fell 3% year-on-year to EUR1.37 billion (USD1.76 billion), while revenues from network services were down by the same margin to EUR1.22 billion. Stripping out the effect of a regulator-enforced cut in voice and SMS call termination rates, the company said sales from network services would actually have risen by 6%. Earnings before interest, tax, depreciation and amortisation (EBITDA) declined 8% to EUR296 million, which mainly reflected the cut in call termination rate differentials. Net profit dropped 34% from a year earlier to EUR59 million.

Bouygues Telecom confirmed that it expects sales to contract by 10% in 2012 and EBITDA to decrease by around EUR250 million. The company has embarked on a EUR300 million cost-cutting plan which it says will start to have an impact in 2013.

France, Bouygues Telecom