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The Carphone Warehouse Group PLC Annual Report 2004
9
Ongoing
Ongoing represents the share in customer call spend
(or ARPU) we receive as a result of connecting subscription
customers to certain networks. We are typically contractually
entitled to our share of revenue for as long as a customer
is active on the number and network that we connected
him or her to, so this income stream represents an
important element of our overall commercial agreement
with many networks.
Ongoing revenues grew by 35.3% to £39.4m during the
year (2003: £29.1m), on top of a 32.1% growth rate in
the previous year. This performance reflects the strong
subscription connections growth over the last twelve
months, as well as the continued effect of our change
in terms of trade with certain networks two years ago.
Under these changed agreements we exchanged an
element of upfront commission for a greater ARPU share
over the customer lifetime, thus improving the quality of
our earnings and aligning our interests more closely with
those of the network operators.
Telecoms Services
“The opportunities for growth in all aspects
of our Telecoms Services operations are
very exciting.”
David Goldie, Chief Operating Officer, Telecoms
Fixed: Opal
Providing voice
telecoms and value-
added services to
SMEs in the UK,
and providing the
network infrastructure
for TalkTalk.
Mobile: Facilities
Management
Managing customer
relationships for
over 1.1m customers
in the UK and France
on behalf of network
operators.
Fixed: TalkTalk
Residential fixed line
services for 0.4m
customers in the UK.
New services launching
in Spain, France and
Switzerland.
Mobile: Own Customers
Recruiting and
servicing over 0.8m
customers through our
newly acquired service
provision business in
Germany and our
MVNO in the UK.
Overview
Telecoms Services
2004 2003
£m £m
Turnover 554.5 158.8
Mobile 305.9 82.7
Fixed 248.6 76.1
Contribution 43.2 26.0
Mobile 23.5 18.0
Fixed 19.7 8.0
Support costs (18.1) (10.4)
EBITDA 25.1 15.6
Depreciation (10.1) (5.7)
EBIT 15.0 9.9
EBIT % 2.7% 6.2%
Before exceptional items and amortisation of goodwill.
The Group’s Telecoms Services operations are split into
two businesses, Mobile and Fixed. The Mobile business
encompasses our facilities management (‘FM’) operations,
managing customers on behalf of networks, and our own