Revenue at Eir rises but earnings fall as increased costs bite

Telecoms company Eir said revenue climbed in the first nine months of the year, but rising costs contributed to a 4 per cent decline in earnings for the period.

The group said on Thursday that revenue for the nine-month period was €937 million, a 4 per cent rise year-on-year, driven by post-pay mobile growth, bundling and access revenue from the National Broadband Plan. Its technology services business, formerly known as Evros, also saw revenue rise.

However, the gains were offset in part by declines in traditional access revenue.

Earnings before interest, tax, depreciation and amortisation were down 4 per cent, or €19 million, year-on-year to €455 million, with €11 million of that decline relating to costs.

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The company reported fixed line revenue of €707 million, up €9 million year-on-year as voice traffic increased and managed services revenue rose.

The overall broadband base declined 1 per cent to 947,000, a fall-off that was fuelled by a 5 per cent drop in wholesale customers. In contrast, Eir added 17,000 retail customers compared to the same period last year. Eir also saw a rise in the number of customers using high-speed broadband services, which increased 2 per cent to 860,000.

The mobile business fared better, with revenue rising by 12 per cent to €258 million. The postpay customer base contributed significantly to growth, with a total of more than 1 million customers. That accounts for around 77 per cent of all mobile customers with Eir; a further 327,000 customers are on prepay plans.

In the third quarter of the year, revenue was €315 million, a rise of 3 per cent or €9 million, while earnings fell 3 per cent to €147 million. Pretax profit was €15 million, reversing the loss seen in the same quarter a year earlier when exceptional costs pushed the company into the red.

“Eir has had another strong quarter, seeing significant customer gains across the business with eir mobile, adding over 100,000 customers, 17 per cent growth in Eir’s TV service customer base and an additional 20,000 fibre broadband connections established nationwide,” said Oliver Loomes, Eir chief executive. “Growth in Eir is underpinned by investment – by building the best infrastructure, we can offer more and better services to our customers – and this investment continues to be the basis of our business model and our ambition for Ireland to be the best-connected country in the world.”

Mr Loomes welcomed ComReg’s recent publication of a plan to move away from copper networks for phone and broadband services. The company has been pushing for the switching off of such networks, describing them as “outdated”, to make way for modern fibre.

“Replacing legacy copper networks will not only be better for our citizens and businesses, fibre networks require 70 per cent less energy to transmit data than copper wire, fibre is also a more resilient technology, requiring less repair and maintenance, thereby helping to reduce Ireland’s overall carbon footprint,” he said. “We believe moving to full fibre connectivity is vital to ensure Ireland is not left behind as technology advances and data demands increase.”