Roger Taylor, CEO, of Carphone Warehouse said that “Virgin Mobile France has proved its resilience in a tough marketplace through excellent management, continuing to grow its postpay base, and with around half its customers on the Full MVNO platform as at the year end.”
Competition in the French market amongst network operators has been intense. However, Virgin Mobile France has proved resilient, growing revenue and its postpay customer base. Its Full MVNO infrastructure enables it to participate more fully in revenue streams, including termination revenues, and to reduce costs, as well as giving it greater tariff flexibility. At the end of the year over 850,000 customers were on this platform, representing 50% of the base, and we will continue to focus on customer migration in the coming year.
The total customer base was down year-on-year at 1.71m customers (2012: 1.92m), partly due to a deliberate reduction in focus on the low-value prepay market, from which there is less visibility of returns on investment. The postpay base increased by 11,000 customers year-on-year to 1.35m (2012: 1.34m) and almost 80% of the customer base is now higher value postpay customers.
On a constant currency basis, we grew revenue by 4.2%, reflecting the growth of mobile termination revenue. On a Sterling basis, revenue was broadly flat for the year at £385.0m, compared to £390.2m in the prior year. Headline EBIT was down year-on-year from £21.5m to £11.9m, affected by an investment of £4.9m (2012: nil) in the development of a quad-play proposition. While this proposition remains in its infancy, it has potential to be a valuable retention tool, whilst also offering opportunities to develop the business’ customer reach.
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