Tuesday, 24 July 2012

Virgin Media UK Q2 2011 results

Mobile revenue up 2.9% to £136m in Q2, with contract mobile revenue up 15% to £102m
− Contract mobile customers increased 53,900 to 1.6m
− Quad-play penetration continues to grow; now at 15.4%
- Mobile revenue was £136.4m, up 2.9% due to growth in contract service revenue, partially offset by the regulated change in MTRs and the decline in prepay service revenue.

Neil Berkett, Chief Executive Officer of Virgin Media, said: "This has been a quarter of improved revenue and OCF growth. We are well placed to benefit from the fast-growing demand for superfast broadband and TiVo positions us well to lead the evolving TV market. Customer ARPU and churn have improved and, together with our growing Business division and great value mobile offerings, we have maintained steady financial progress across the company which is translating into strong free cash flow as well as continued shareholder returns."

As reported: "Continued improvement in the proportion of mobile customers with contracts resulted in 2.9% total mobile revenue growth to £136.4m. The strong contract revenue growth was partially offset by the headwinds of declining prepay revenue and regulatory changes to mobile termination rates (“MTR”). Contract service revenue increased 15% to £101.7m, while prepay service revenue declined by 20% to £32.8m. MTR changes reduced the amount of inbound mobile revenue we received by approximately £6m in the quarter. Excluding this regulatory factor, we estimate that mobile revenue would have increased by approximately 7%, when compared to the same quarter last year. Due to a similar associated reduction in interconnect costs for our mobile and fixed line businesses from these regulatory rates changes, the impact on group OCF was broadly neutral."