Virgin Media O2 fixed broadband jump delivers overall customer growth

Virgin Media O2, the UK JV between Liberty Global and Telefónica, has returned to broadband customer growth in the third quarter, adding 40,800 broadband customers in the quarter.

Lutz Schüler (Source: Virgin Media O2)

Overall, VMO2 gained 32,500 net customers, up from a gain of 12,300 last year, with broadband growth offsetting losses elsewhere.

Virgin Media O2 has meanwhile reached an agreement to sell a 16.67% minority stake in its mobile tower joint venture, Cornerstone Telecommunications Infrastructure Limited to the UK-based infrastructure fund, GLIL Infrastructure LLP. Virgin Media O2 will receive approximately £360 million in cash on closing.

VMO2’s total  fixed customer base stands at 5.8 million. The mobile base including contract and prepaid customers, stands at 24 million. The group added 50,000 contract mobile customers in the quarter, to take its total to 16.1 million.

The operator now has 1.75 million converged customers taking one of its Volt bundles.

VMO2 can now serve 16.7 million, or 58%, of total UK homes. Fibre was built out to a record 250,800 new premises in Q3, mostly through the nexfibre JV.

The company posted transaction adjusted revenue of £2.8 billion for the quarter, up 7.1% and EBITDA of £1 billion, up 5.6%.

“With wider economic pressures persisting, Q3 has remained a tough environment to navigate as some consumers tighten spend, notably across mid-tier TV, home phone and on low-margin handsets. However, notwithstanding these factors, Q3 has seen positives – the implementation of price increases across the second quarter have led to service revenue growth; we’ve returned to strong customer additions across the board; and our converged fixed-mobile proposition continues to perform well, with 1.75 million people now taking a Volt bundle,” said CEO Lutz Schüler.

“We are continuing to invest in our products, services and networks to give our customers an even better experience. This has included bringing 5G connectivity to new areas and expanding our fixed network footprint faster than ever before to reach over half a million new fibre premises so far this year. We’ll continue to be opportunistic in the market where the economics and strategic logic stacks up as recently demonstrated through the successful acquisition of Upp, and the sale of a minority stake in our mobile tower joint venture Cornerstone. Despite external pressures, we remain firmly focused on delivering for our customers in line with our core strategy.”