O2 Czech Republic today reports its unaudited operating and financial results for the first quarter 2017. Consolidated figures include results of all daughter companies.
"In the first quarter 2017, again, we brought several new propositions to our customers. Unlimited home internet is now available to 99% households in the country," comments Tomáš Budník, Chief Executive Officer and the Chairman of the Board of Directors of O2 Czech Republic on the results, and adds: "We provide selected sport content via new O2 TV Free channel, which is distributed through terrestrial free-to-air broadcasting. Through HbbTV technology, our customers can access complete content and all favourite functions, like time shift."
"Our financial results through 2017 will be negatively impacted by European regulation. That's why I am glad that customers' interest in our services led to revenue and profitability growth," amends Tomáš Kouřil, company's Chief Financial Officer and Vice-Chairman of the Board of Directors, and continues: "In April, we have been able to arrange new funding. We benefited from current favourable conditions to finance future company's need. "
Operating overview
Mobile segment
As of 31 March 2017, total number of mobile customers reached 4.924 million, up by 0.7% year-on-year. The number of contract customers increased by 3.0% year-on-year reaching 3.372 million. They represented already 68.5% of the mobile customer base, up by 1.5 percentage point. Number of prepaid customers reached 1.552 million customers.
Helped by broadband network rollout and tariff proposition with increased data package mobile data traffic increased by two thirds. Number of internet in handset service went up by 15% year-on-year to 1.824 million.
Already 58% of handsets in O2 network is already a smartphone and 36% supports LTE technology. Number of customers with LTE smartphone and with USIM card, which supports the new technology, reached over 930 thousand at the end of March.
Fixed segment
Number of O2 TV service customers provided on O2 fixed line as well as on internet connection from any provider reached 222 thousand (IPTV and OTT) as at 31 March 2017, up by 5% year-on-year. A complementary service MULTI which enables customers watching TV on more TV sets at one time became very popular. Already over 34 thousand customers subscribed for this service and thus O2 can show off with over 255 thousand active set top boxes. At the beginning of January 2017, O2 added to its sport dedicated channels proposition new O2 TV Tennis channel, which offers the customers exclusively all tournaments of WTA women's series, as well as 14 men's ATP tournaments. Thanks to focus on Czech players track, O2 TV Tennis immediately ranked among the most watched sport channels in O2 TV offer. During the first quarter 2017, O2 expanded distribution of its sport content with new O2 TV Free channel broadcasted via free-to-air terrestrial with exclusive content and favourite functions available via HbbTV technology for a daily fee.
The customers also like watching O2 TV via internet and mobile application, or in restaurants. By the end of March 2017, restaurants, pubs and bars offering O2 TV service increased already to over 1,200. Number of viewers, who actively watch O2 TV via internet and mobile application, continues growing and in March 2017 these means of watching TV were already used by over 425 thousand watchers.
Number of
xDSL fixed internet customers reached 764
thousand at the end of March 2017.
Thanks to internet speed increase through installation of
remote DSLAMs, the share of customers enjoying VDSL technology
on total xDSL base reached already 66%. For households with
insufficient internet speeds over xDSL, O2 has been offering an
unlimited 4G LTE wireless connection since March. Combining
both technologies, O2 covers 99% of all addresses in the Czech
Republic.
Total number of fixed voice lines reached 677 thousand at the end of March 2017.
Slovakia
Number of mobile customers in Slovakia increased by 3.9% year-on-year to 1,892 thousand, of which contract base grew 9.4% to 1,091 thousand. Their share in total base increased by 2.9 percentage point to 57.7%.
Financial overview
Total consolidated operating revenue reached
CZK 9.224 billion in the first quarter 2017,
up 2.1% year-on-year.
Operating revenue in the Czech Republic
totalled CZK 7.528 billion, representing a 0.9% growth.
Fixed business operating revenue declined by
2.6% year-on-year to CZK 2.756 billion, as 12% growth of O2 TV revenue and close to 50% increase in hardware
revenue driven by successful sales of solutions for electronic
sales reporting did not fully compensate lower voice and data
revenue.
Mobile operating revenue reported 3% growth to
CZK 4.772 billion. The year on year decline of voice revenue
slowed down and was compensated by mobile data and hardware
revenue uptake. In
Slovakia, revenue reached
CZK 1.730 billion, a 7.2% year-on-year growth.
Revenue denominated in euros
improved by 7.3% to EUR 64 million. Similarly
to the Czech Republic, higher data and hardware revenue were
the key drivers.
EBITDA increased by 1.2% year-on-year to CZK2.533 billion in the first quarter 2017. Net profit improved by 3.4% year-on-year reaching CZK 1.286 billion.
KEY FINANCIAL AND OPERATING INDICATORS
Financial indicators for the Group
| Financial indicators | 1Q 2017 | 1Q 2016 | Year-on-year change |
Operating revenue - CZ mobile revenue - CZ fixed revenue - SK revenue | CZK 9,224 mil. CZK 4,772 mil. CZK 2,756 mil. CZK 1,730 mil. | CZK 9,031 mil. CZK 4,635 mil. CZK 2,828 mil. CZK 1,613 mil. | + 2.1 % + 3.0 % - 2.6 % + 7.2 % |
Total costs -of which operating costs | CZK 6,719 mil. CZK 2,077 mil. | CZK 6,595 mil. CZK 1,978 mil. | + 1.9 %
+ 5.0 % |
| EBITDA | CZK 2,533 mil. | CZK 2,503 mil. | + 1.2 % |
| EBITDA margin | 27.5 % | 27.7 % | - 0.2 p. p. |
| Net profit | CZK 1,286 mil. | CZK 1,244 mil. | + 3.4 % |
Operating indicators - Czech Republic
| Number of mobile customers | 31 Mar 2017 | 31 Mar 2016 | Year-on-year change | |
| Relative | Absolute | |||
| Contract customers | 3,372m | 3,274m | + 3.0 % | + 98k |
| Prepaid customers | 1,552m | 1,614m | - 3.8 % | - 62k |
| Total | 4,924m | 4.888m | + 0.7 % | + 36k |
| ARPU | CZK 288 | CZK 284 | + 1.7 % | |
| Number of fixed service customers | 31 Mar 2017 | 31 Mar 2016 | Year-on-year change | |
| Relative | Absolute | |||
| O2 TV | 222k | 211k | +5.0% | +11k |
| O2 TV application and web (number of viewers) | cca. 430k | cca. 330k | ||
| xDSL | 764k | 790k | -3.3% | -26k |
| VDSL | 514k | 455k | +12.9% | +59k |
| Fixed voice lines | 677k | 803k | -15.7% | -126k |
| Smartphones | 31 Mar 2017 | 31 Mar 2016 | Year-on-year change |
| Smartphone penetration within the O2 network | 58.1% | 50.4% | +7.7 p.p. |
| LTE smartphone penetration within the O2 network | 35.6% | 21.7% | +13.7 p. p. |
Operating indicators - Slovakia
| Number of mobile customers | 31 Mar 2017 | 31 Mar 2016 | Year-on-year change | |
| Relative | Absolute | |||
| Contract customers | 1.091m | 998m | +9.4% | +93k |
| Prepaid customers | 801k | 823k | -2.7% | -22k |
| Total | 1.892m | 1.821m | +3.9% | +71k |
Contacts
Lucie Pecháčková
lucie.pechackova@o2.cz
tel: 800 163 342 (800 1 media)
O2 is the largest integrated telecommunications provider in the Czech market. At present we operate close to eight million mobile and fixed accesses, which ranks us among the market leaders in fully converged services in Europe. To users of mobile services in the Czech Republic we offer state-of-the-art HSPA+ and LTE technology. We have the most comprehensive proposition of voice and data services in the Czech Republic, and we actively exploit the growth potential of the various business lines, especially ICT. Our data centres, with total floor area of 7,300 square metres, rank us among the leaders in hosting, cloud and managed services. O2 data centres belong to the few commercial ones in Central Europe to have TIER III certification. With our O2 TV we are also the largest IPTV service provider in the Czech Republic. In January 2014, O2 became a member of the Czech investment group PPF.
