O2 Czech Republic reports rising revenue, EBITDA and net profit in FY 2017

1 Feb 2018

Fixed line, broadband and mobile operator O2 Czech Republic reports that consolidated revenue increased by 0.5% to CZK37.7 billion (USD1.85 billion) in full-year 2017, as EBITDA rose by 0.6% to CZK10.5 billion and net profit grew by 6.2% to CZK5.6 billion. The telco attributed the strong results to the introduction of a number of ‘new propositions’ over the year, such as its unlimited home internet service (launched in February), which it says is available to 99% of Czech households, and a new O2 Smart Box device which it claims offers an improved broadband internet connection and quality home Wi-Fi coverage. O2 CR closed out 31 December 2017 with a total of 729,000 xDSL subscribers, and reported that thanks to the ongoing installation of remote DSLAMs, the share of customers enjoying VDSL technology reached almost 75% by the end of the year. The network upgrades have helped it to boost tariff speeds: in October, O2 increased the speed of it ‘Internet Premium HD’ tariff from 80Mbps to 100Mbps without increasing the price.

Furthermore, the operator says that it is targeting households with poor DSL speeds by offering them access to an unlimited broadband connection using its 4G LTE network (since March), which taken with its fixed broadband infrastructure, gives it a combined coverage of 99% of all addresses across the Czech Republic. ‘The customers’ demand and interest in this service is confirmed by the fact that at the end of 2017, over 770,000 of them actively used the unlimited internet connection regardless of technology,’ the firm said in a statement. Meanwhile, the number of people using its fixed voice telephony services was 613,000 at end-2017, while the number of O2 TV (IPTV) customers, as well as those with OTT from any provider, reached 237,000 at 31 December 2017, up 7.5% year-on-year.

In the mobile segment, O2 CR had a total of 4.938 million mobile subscribers at 31 December 2017, unchanged y-o-y, although it did note that within the base, the proportion of contract customers increased by 2.2% (or 73,000) to 3.429 million and now represents 69.4% of the total user base. The number of pre-paid customers stood at 1.510 million at the same date. In addition, the operator noted the growing number of customers with LTE smartphones contributed to mobile data consumption increasing by 106% when compared to FY 2016, as the number of mobile internet users went up by 25.3% y-o-y to 2.228 million at end-2017. Smartphones accounted for 63% of all handsets on its network at that date, of which 46% support LTE technology, it said. Close to 90% of customers with LTE handsets have already replaced their SIM card with a new one supporting the technology, it added.

Commenting on the group’s results, CFO and vice-chairman of the board of directors Tomas Kouril, said: ‘2017 has been a year of higher capital expenditures. We managed to extend the period for which we can use O2 brand and acquired new spectrum licences. In Slovakia, thanks to the higher investments into our own network we have become the leader in terms of 4G LTE broadband mobile network coverage.’ Indeed, the group’s Slovakian unit ended 2017 with a total of 1.937 million mobile subscribers (up 2.3% y-o-y), including 1.141 million on monthly contracts (+5.9%) as its share of the overall mobile market inched up by two percentage points to 58.9%.

Czech Republic, O2 Czech Republic (incl. CETIN), O2 Slovakia