Eircom's losses grow on restructuring costs

Friday 29 August 2014 17.20
Eircom's restructuring programme cost the company more than €200m during the year
Eircom's restructuring programme cost the company more than €200m during the year

Eircom made a loss of €333m in its full year to the end of June as it incurred costs relating to its restructuring programme.

The company had a €235m exceptional charge during the year, the majority of which was used to cover the cost of redundancies and a defined benefit pension scheme.

Eircom made a loss of €117m last year, during which time it took an exceptional charge of €22m.

Revenue at the communications group was 6% lower over the year at €1.28bn, with earnings before interest, tax, depreciation and amortisation falling 1% (€3m) to €479m.

Eircom was also forced to book a €10m expense to cover the cost of repairs following storm damage earlier this year.

The company did reduce its operating costs by €91m over the twelve month period, however, with its employee numbers falling by almost 1,100 during that time.

The firm also saw a €39m improvement in its finance costs following a restructuring of its debt.

During the year the number of broadband connections managed by the company rose 7.5% to 718,000. Eircom said the rate of ‘churn’ – that is the percentage of customers switching to other providers – also fell.

It said it had 133,000 subscribers to its new fibre broadband service, while 21,000 customers had signed up to its television platform ‘eVision’.

Eircom said the number of its products being used by each customer was also up, with the average subscriber now using 1.8 Eircom services.

This is following a push by the company to promote bundles, with 14% of Eircom’s customer base now on triple or quad-play packages.

Eircom and Three sign network sharing deal

Eircom and Three have signed a network sharing agreement that will see the two companies share mobile network infrastructure for at least 16 years.

The companies have also committed to building new sites together and said it would help the roll out of higher quality 4G connections across the country.

Three were required to enter a network sharing agreement with another telecom as part of its acquisition of O2 Ireland.

Eircom had previously entered a similar arrangement with O2 Ireland in 2011.