O2 today announced its operating and financial results for the first half of 2015, following the company's separation. Consolidated figures include the results of subsidiaries, including O2 Slovakia. The results for the whole reporting period exclude the results of Česká telekomunikační infrastruktura (CETIN).
Thanks to a strong focus on quality and the value of the customer base, the company has managed to maintain its position on the shrinking telecommunications market.
" These are the first presented results following the company' s separation into the separate companies O2 and CETIN. We have succeeded in stabilising revenues and in increasing our operating profit EBITDA. We are capable of generating free cash flow in excess of our net profit. That serves to confirm our belief that the separation was a step in the right direction and that it will bring future value for our customers and shareholders alike," said Tomáš Budník, CEO of O2 Czech Republic, delivering an assessment of the first half-year.
O2's total consolidated operating revenue stabilised year on year reaching CZK 18.393bn. EBITDA increased year on year by 32.4 percent. Net profit reached CZK2.3bn, marking a 54 percent increase. Mobile data and O2 Slovakia remain the two key growth areas.
As of the end of June 2015, mobile services provided by O2 were used by a total of 4.945m customers. The number of customers on a contract remained flat year on year at 3.252m. The segment of prepaid services recorded a decrease to 1.693m customers. As many as two-thirds of the company's customers now use one of the FREE tariffs.
O2 customers are demonstrating a growing appetite for smartphones, with the proportion of the devices within the O2 network continuing to increase. In the first half-year, the proportion of smartphones within the O2 network rose year on year by five percentage points to 43.7 percent, while more than one fourth of these devices support LTE networks. In terms of smartphone operating systems used within the O2 network, Android is clearly dominating with a share of 74.2 percent. The proportions of the remaining operating systems in use are as follows: iOS - 9.4 percent, Windows Phone - 7.1 percent, Blackberry - 1.4 percent. The proportion of smartphones running the Symbian operating system decreased year on year by 12.4 percentage points to 6.6 percent.
The development of mobile broadband is closely followed by rising demand for mobile internet access. At the end of the first half-year, number of small screens reached more than 1.5m, giving a year on year increase of 14 percent. Revenue from mobile data services thus increased by 6.6 percent year on year.
The digital television service O2 TV and fixed internet both continue to manifest positive trends in terms of customer numbers. With the new O2 Sport channel in preparation and given the attraction of O2 TV's unique functionalities, the service subscription level reached almost 190,000 households in June and the number of subscribers continues to grow. The O2TV Go application, which enables the watching of TV channels on portable devices, has been downloaded as many as 350,000 times.
The number of fixed internet customers reached 799,000 at the end of June, after a year on year increase of 1.1 percent, with a net increase of 5,000 customers over the first half-year. Of the total number of customers, 51 percent already use VDSL technology.
Total consolidated operating revenue reached CZK 18.393bn in the first half-year, marking a year on year decrease of 0.3 percent. Yet in the first half-year 2014 [1] operating revenues declined by almost 9%. Fixed business operating revenue decreased year on year by 8 percent to CZK 5.739bn. O2 TV remains the main growth area, while voice services show a decreasing tendency. Operating revenue in the mobile segment increased by 1.1 percent to CZK 9.505bn.
EBITDA increased year on year by 32.4 percent to CZK4.825bn. The EBITDA margin reached a solid 26.2 percent, after a year on year increase of 6.5 percentage points.
O2 Slovakia remains one of the key growth areas. Revenues for the first half-year reached EUR117.3m, marking a year on year increase of14.1 percent. In effect, the results achieved in Slovakia contributed a full 17 percent to the group's total result. The total number of customers in Slovakia reached 1.711m, representing a year on year increase of6.4 percent. EBITDA increased year on year by 20.2 percent to EUR 40.8m.
Financial indicators for the group
| Financial indicators | 1H 2015 | 1H 2014 (pro forma) | Year on year change |
| Operating revenue | CZK 18.393bn | CZK 18.439bn | - 0.3% |
| Total operating costs | CZK 13.625bn | CZK 14.643bn | - 7.0% |
| EBITDA | CZK 4.825bn | CZK 3.643bn | + 32.4% |
| EBITDA margin | 26.2% | 19.8% | + 6.4 p.p. |
Operating indicators - Czech Republic
| Number of mobile service customers | 1H 2015 | 1H 2014 | Year on year change |
| Contract customers | 3.252m | 3.253m | 0% |
| Prepaid customers | 1.693m | 1.807m | - 6.3% |
| Total | 4.945m | 5.060m | - 2.3% |
| Smartphones | 1H 2015 | 1H 2014 | Year on year change |
| Smartphone penetration within the O2 network | 43.7% | 38.1% | + 5.6 p.p. |
[1] Original O2, incl. revenue from CETIN
Contacts
Kateřina Mikšovská
Press department
katerina.miksovska@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.
