O2 service revenues down 9.1%

O2 Ireland said today that service revenues declined by 9.1 per cent in the year to the end of September.

O2 Ireland said today that service revenues declined by 9.1 per cent in the year to the end of September.

Service revenue for the third quarter totalled €213 million, up from €211 million in the preceding quarter and the company maintained its position as the number one operator in the postpay mobile market with 676,365 contract subscribers.

O2’s total customer base at the end of September was 1.717 million, up from 1.713 million when compared with the same period last year, and up slightly over the preceding quarter.

The company said it gained an additional 13,761 postpay customers during the third quarter while the number of prepay subscribers it has fell by 12,945.

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Data revenue as a percentage of overall service revenue grew year-on-year, driven by growth in non-SMS revenues which accounted for 10.4 per cent of revenues in the third quarter, up from 7.3 per cent for the same three-month period a year earlier.

Average revenue per user (ARPU) was €39.90, down 8.7 per cent from €43.71 year-on-year.

Some 783 million text messages were sent by O2 customers during the third quarter, up by 28.6 per cent on the same quarter a year earlier. However, average monthly miniutes of use decreased slighly in the quarter from 228 to 226.

The company said it now has over 125,000 mobile broadband customers.

"Despite the tougher economic environment continuing to impact on trading conditions, O2 delivered a solid performance in the third quarter. Total customer numbers increased when compared with the same period last year and O2 maintained its leadership position in the postpay mobile market in Ireland with 676,365 postpay customers at the end of the quarter," said Paul Whelan, chief financial officer with O2.

"While service revenues also increased marginally in the quarter, we continue to maintain our emphasis on cost management as we move into what is likely to be a more challenging Christmas trading period”," he added.

Net profit at O2 Ireland's parent Telefonica rose 0.3 per cent to €5.61 billion during the first nine months of 2009.

However, overall revenues 3.3 per cent to €41.72 billion in the year to the end of September while while operating income before depreciation and amortisation (ebitda) fell 2.2 per cent to €16.65 billion

Charlie Taylor

Charlie Taylor

Charlie Taylor is a former Irish Times business journalist