O2 slows revenue decline and grows customer base 10%

O2 slows revenue decline and grows customer base 10%

Telefonica UK’s Q3 results show the operator making progress in turning around Q2’s 4.4% revenue drop year on year, reducing the loss to 2.1% with the company heralding a 1.1% increase in Mobile service revenue as partially responsible.

Elsewhere the company added 199,000 new contract connections, while holding its industry leadingly low 0.9% churn rate to deliver a 10% year on year increase in their customer base.

CEO Mark Evans attributed O2 UK’s customer success to a focus on customers and unique content propositions such as O2 Priority, stating, ‘More customers are choosing to join and stay with us every quarter due to our superior mobile service experience and the benefits of our unique propositions such as O2 Refresh and O2 Priority.

'Our customers are consuming more data, spending more and rewarding us with the highest loyalty in the industry demonstrating the success of our unique customer-led, mobile-first strategy. We will continue to give customers more reasons to stay with us by providing the benefits that only come with being part of the O2 family’

Evans also discussed the likleyhood of O2 UK’s proposed IPO, hinting that market forces such as exchange rates and the repercussions of Brexit could make the move unlikely.

The UK CEO told Mobile, ‘It is a real and distinct opportunity for the business but it is being prepared for as opposed to being committed to, and I will draw that very clear distinction.

‘The IPO of the UK business is an opportunity, if the market conditions were right. What we’ve seen of course over the last eight weeks is the market soften, currency conversion certainly hasn’t helped us from an exchange rate perspective so we’re not going to be distracted by that, we’re going to continue preparing, and we’re making great grounds in doing so.

‘The banks, the advisors, the analysts we’ve seen to date have been impressed by our performance and strategy, but we won’t be wedded to and therefore we won’t be committing to a timeline..

‘..One thing is for sure we there won’t be any movement in 2016.’

While capital expenditure within the company grew to £200 million for Q3 (+18% YoY), OIBDA also increased by 1.5% YoY.

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