Euskaltel hails strong start for Virgin telco as COVID-19 takes its toll

Euskaltel CEO José Miguel García unveiling the Virgin telco brand earlier this year

Growth from Spanish regional cable operator Euskaltel’s national launch under the Virgin telco brand has exceeded the company’s initial expectations, with 38,000 additions from this brand contributing to an overall net growth in the operator’s customer base of 20,000 for the quarter to September.

The new operation added 21,000 fixed line customers, taking its total to 27,000. Mobile additions amounted to 9,000. The operator had previously set a target of 35,000 fixed customers by the end of the year.

Virgin telco also helped boost the company’s top line, with revenues for the quarter up 1.8% to €174.2 million.

This is the fourth consecutive quarter of revenue growth compared to the prior year and the company’s biggest growth in revenue in recent years.

Virgin telco’s revenue has grown to €3 million in the quarter, in line with its strong customer base growth which is expected to continue this upward trend over the coming months. Furthermore, revenue from the company’s traditional business has also seen positive growth of 0.1% due to stable customer revenues and excellent performance in the business services segment.

In the first nine months of 2020, EBITDA has risen 3.2% compared to the same period last year, up to €260.2 million at 30 September, with a 50.3% revenue margin that is 119 basis points higher than in September 2019.

Euskaltel now has 802,000 customers overall. Broken down by segment, mobile revenue-generating units increased the most, with 21,000 additions, followed by broadband with 19,000. The company now has 695,000 fixed and 106,000 mobile customers.

Euskaltel said that while Virgin telco had exceeded expectations, the overall growth it achieved was muted by the impact of COVID-19.