CK Hutchison said its 3 Europe business “continues to improve” in revenue and EBITDA terms, as the unit remains a key factor in the continent’s consolidation game.
3 Europe EBITDA increased 12 per cent to HK$17.4 billion ($2.2 billion) on revenue which decreased 4 per cent to HK$62.8 billion for the year to 31 December 2015. However, it claimed revenue and EBITDA growth of 10 per cent and 27 per cent respectively in local currencies.
The company noted gains from further improvements in net customer service margin in the UK, a full year of earnings contribution following its O2 Ireland buy, and “continued cost synergies” for 3 Austria.
Hutchison is currently involved in complex discussions related to its plan to combine 3 UK with the Telefonica-owned O2 UK, while it is also looking to form a joint venture with VimpelCom for the Italian market.
It said that such deals are “expected to create sufficient scale and capacity for delivering significant operational efficiencies and enhancing network quality and innovations in these markets, and in-turn, generating accretive earnings to the group”.
The 3 Europe customer base increased by 4 per cent during the year, to reach 30.6 million customers (mostly in UK and Italy), with the percentage of these on contracts remaining stable at 58 per cent.
Average revenue per user increased by 5 per cent, “primarily due to a focus on upselling and improved customer propositions across the majority of the operations”, although competition in Denmark and increases in the prepaid base following the O2 Ireland deal also took their toll.