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Thursday, November 11, 2010

Telefonica reports quarterly results for O2 UK

O2Telefónica Europe is the latest company to report its Q3 financial results. It says its European customer base has risen 14% year-on-year to 55 million users, with its mobile customer base up 5.5% year-on-year to 45.9 million.

Organic revenue growth for the nine months to September was up 3.7% year-on-year in constant currency; a figure that would have been 6.4% were it not for mobile termination rate cuts. Revenue growth was driven by the UK and Germany, offsetting what were described as "challenging market conditions" in the Czech Republic and Ireland. Reported revenue reached €11.24 billion (£9.5 billion) in the first nine months, up 11.8% year-on-year, while Q3 itself saw year-on-year growth of 13.7%.

Matthew Key, Chairman and Chief Executive of Telefonica Europe, said "Telefónica O2 UK continued to outperform its peers by focusing on delivering the best customer experience in an increasingly competitive arena – evidenced by O2 retaining its market-leading customer retention rates with contract churn of just 1.2% in the quarter. Revenue growth accelerated to 8.5% year-on-year in local currency in the third quarter to stand at €5.32 billion for the nine months to September. This was driven largely by the increasing demand for high-end smartphones, with 20% of our total base and more than 40% of our postpay customers now using mobile broadband devices. O2's mobile base in the UK (excluding Tesco Mobile) reached 22 million customers, up 4.8% on last year, with net additions of 352,000 in Q3 – an increase of 20.4% year-on-year. That's nearly 70% of new customers were in the contract segment is testament to our ongoing success in attracting high-end users. O2 is now the UK's leading service brand, serving more paying customers on an ongoing basis than any other brand."

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