Up, down, black, white
The newly combined Orange and T-Mobile has announced its first quarterly results, with revenues and customers up or down depending how you count them.
Revenue is down 4.8 per cent to £1.72bn, but that's the government's fault, and the drop in subscribers only exists if you insist on comparing to earlier this year rather than 12 months ago. EBITDA (the made-up number that passes for profits these days) is down 18.4 per cent. The synergies are on track to save the combined company a fortune, though Everything Everywhere has now announced that it will be opening more shops and building more base stations - not the removal of duplication we were expecting.
It's the first time Everything Everywhere has reported results, having been established as a legal entity on April 1, so comparisons are based on businesses that combined to create the new company. On that basis both pre and post paid numbers are down on the last quarter, but both numbers are up on the same period last year, so Everything Everywhere is obviously highlighting the latter figure. That shows customers are up 8.6 per cent and 1.3 per cent respectively to a total of 27.93 million users, worth an average of £19.2 a month each and contributing to the total revenue (from mobile) of £1.56bn during the last three months.
This revenue figure is down 4.8 per cent, but with typical style the company reckons it's actually up by one per cent once you allow for the government-mandated reduction in termination fees - revenue would have increased if it weren't for those darn regulators.
Including the Orange broadband subscribers, still topping 800,000, and everything else, the company brought in £1.72bn and reckons it's on the verge of making huge savings through synergy.
That synergy (cutting duplicate departments and kit) is still on track to be worth £3.5bn, though that now includes opening more shops and expanding the base station network to more than 18,000, rather than reducing it as had been predicted. Many of those base stations will come from 3, which has transferred the network-sharing agreement it had with T-Mobile to Everything Everywhere, so the country's largest and smallest network operators will be sharing 3G infrastructure that will now comprise more than 18,000 transceivers.
The retail operation apparently needs to be expanded for customer retention reasons - a presence on the high street is now essential for a mobile operator to be taken seriously, and despite all the Orange and T-Mobile shops Everything Everywhere plans to increase that presence.
We still don't know how the new company will be branded. For the moment it's quite happy selling T-Mobile and Orange as separate offerings, though eventually that synergy will surely spread to branding and at least one of the pre-merger names will have to go.
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