Profits at eircom climb despite mobile market effect
The value of calls made on the eircom network has fallen as more customers switch to mobile phones, it emerged today.
Eircom’s half yearly results showed a 9% decrease in national call minutes, a 10% decrease in international call minutes and a 4% decrease in land-line to mobile call minutes.
Despite a 12% increase in local call minutes, eircom’s call turnover fell by €15m. The company said the weakness in its traditional call market was principally due to consumers using mobile phones instead.
It is looking to move back into the mobile market to compete with the existing three operators.
“Our determination… to re-enter the mobile market and bring competition and value to the mobile customer, remains undiminished,” said chief executive Philip Nolan.
Eircom’s operating profit for the first six months of the year increased by 52% to €128m, before restructuring and exceptional operating costs.
Its line and equipment rental turnover also increased to €237m compared to €219m for the same period last year. Eircom raised line rental charges by 14% last year.
The number of eircom customers signing up for high speed broadband internet connections increased from 83,000 in September to 102,000 now.
Mr Nolan said the company was connecting 3,000 new broadband customers every week. He added that it had set a new target of 500,000 broadband users by 2007.
Around 416 staff left eircom this year through early retirement and voluntary severance programmes, which cost around €6m.
Eircom issued more than 8 million share options to executive directors and senior executives, who used this right to buy 1.3 million company shares.
