O2 Irish arm makes €154.9m profit

PRETAX PROFITS at the main Irish arm of mobile phone giant O2 last year dropped by 9.7 per cent to €154.9 million.

Accounts filed with the Companies’ Office show that revenues at Telefonica O2 Ireland Ltd dropped by 3 per cent from €940.8 million to €912.3 million.

According to the directors’ report, the company’s customer base last year increased by 5 per cent, or 81,561, to 1.727 million.

The figures show that the Spanish-owned company recorded a 40.5 per cent increase in text messages from 1.63 billion to 2.29 billion during 2008.

However, average monthly minutes of use decreased by 3.6 per cent from 252 million to 243 million.

The latest data from the body charged with the regulation of the sector, Comreg, confirms that there are currently 4.8 million mobile phones in use in Ireland.

The directors of Telefonica O2 Ireland Ltd state: “The company’s performance during the year demonstrated strong overall growth, resulting in an increase in overall customer numbers by more than 81,000.”

The filings show that compensation for key company management, including share-based payments and other benefits, increased by 31 per cent from €4 million to €5.2 million last year.

The directors confirm that last year, the company invested €82 million in its Irish network. Its operating profit dropped by 5 per cent from €184.9 million to €175 million. Cost of sales increased marginally from €414.7 million to €415.5 million.

The filings show that the company incurred €128 million in marketing costs, €87.8 million in network costs and €22 million in operating lease payments. Administrative expenses decreased by 5.7 per cent from €341 million to €321.7 million.

The company had €1 billion in accumulated profits at the end of December last. The numbers employed at the firm decreased by 90 from 1,293 to 1,203. Staff costs decreased by 14 per cent from €94 million to €80 million.

A separate O2 company, Telefonica O2 Ireland Retail Ltd, which sells mobile phones and related products, recorded a loss of €3.4 million to the end of December last.