Mobile revenue growth offsets fixed line declines at CWC

8 Nov 2012

UK-based Cable & Wireless Communications (CWC) has released its interim financial statement for the six-month period ended 30 September 2012, with the company reporting flat turnover and earnings before interest, tax, depreciation and amortisation (EBITDA).

In the period under review, CWC posted a consolidated turnover of USD1.431 billion, down 1% year-on-year, with a 9% increase in mobile revenues compared to the year-ago period – boosted by a growth in mobile data services – offsetting most of the decline in fixed line turnover. Group EBITDA for the six-month period stood at USD445 million, following what CWC called ‘an improved performance in the Caribbean and continued strength in Macau’. Adjusted for currency, CWC noted that group revenue and EBITDA were actually 1% and 2% higher respectively than in H1 2012. Operating profit in the first six months of CWC’s 2013 fiscal year rose by 19% to USD256 million, with net profit for the period rising by 11% y-o-y to USD120 million.

Looking ahead, the company has reiterated its guidance for the full-year period, noting that it expects group EBITDA to be similar to FY2012, while capital expenditure in FY2013 will be approximately USD350 million.

At end-September 2012 CWC’s total mobile subscriber base stood at 4.391 million, down from 4.907 million a year earlier, with the decline linked to the deactivation of ‘low value, promotion driven customers’ in Panama in the first quarter of the year. Following the deactivation, the group’s Panamanian unit reported a mobile subscriber base that had fallen by 27% y-o-y to 1.785 million. Group broadband subscribers totalled 552,000 at the end of the reporting period, almost unchanged from 553,000 at end-September 2011, while fixed voice accesses numbered 1.391 million, down 2.4% over the year.

Commenting on the financial performance, CWC chief executive officer Tony Rice said: ‘We have seen momentum continuing to build for our mobile data services, and this is driving our mobile service revenue. Significant investments in high speed, mobile data capable networks across the Group last year are already delivering returns, and we expect the growth to continue. Voice revenue, however, continues to decline and we are delivering on our plan to reduce costs to mitigate this.’