Carphone Warehouse 2006 Annual Report Download - page 16

Download and view the complete annual report

Please find page 16 of the 2006 Carphone Warehouse annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 82

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82

OPAL NETWORK NOW SWITCHING
OVER 1.5bn MINUTES
A MONTH (m)
’06’05’04
5,517
9,563
12,992
STRONG GROWTH ACROSS ALL
MOBILE BASES (000s)
’06’05’04’03
1,115
1,973 2,262
3,073
Operational Performance
Telecoms Services Division
2006 2005
Headline Financials £m £m
Revenue 1,126.5 804.0
Mobile 459.8 377.7
Fixed 666.7 426.3
Contribution 109.5 79.6
Mobile 48.4 45.3
Fixed 61.1 34.3
Support costs (29.7) (25.0)
EBITDA 79.8 54.6
Depreciation and amortisation (53.4) (32.0)
EBIT 26.4 22.6
EBIT % 2.3% 2.8%
The Group’s Telecoms Services operations are
split into two businesses, Mobile and Fixed.
The Mobile business encompasses our German
service provision business, The Phone House
Telecom; our Facilities Management (FM) business,
managing mobile customers on behalf of networks
in the UK and France; and our MVNO operations.
The Fixed business primarily comprises Opal, our
business-to-business service and network operation,
and TalkTalk, our residential service, both in the
UK. We also operate a number of smaller fixed
line businesses across Europe.
Telecoms Services revenues grew by 40.1% year-
on-year to £1,126.5m (2005: £804.0m), with good
growth across all major business lines. Headline
EBIT increased by 16.5% to £26.4m (2005: £22.6m).
The Headline EBIT margin fell from 2.8% to 2.3%
as we invested heavily in our broadband and
MVNO strategies.
Mobile
Overall we achieved revenue growth of 21.7%
to £459.8m (2005: £377.7m), with contribution
rising 6.8% to £48.4m (2005: £45.3m).
The Phone House Telecom, our German service
provision business, continued to perform well in
a competitive market. The overall customer base
was up 30.0%, and by March 2006 we had 1.17m
customers, of whom 0.82m were on two year
subscriptions. During the year we expanded our
distribution channels, as planned, by opening new
stores and signing up new distribution partners.
Revenues rose by 13.1% to £337.4m, with contribution
up by 40.1% to £49.8m. Subscription ARPUs fell, with
one or two new channels delivering significantly lower
customer ARPUs.
Total amortisation of SAC was £30.9m compared
to £19.2m last year. The total cash cost of SAC during
the year was £44.7m (2005: £22.5m), with the rise
driven by our aggressive customer acquisition strategy.
We anticipate that in the coming year, SAC cash costs
will fall, with amortisation of SAC broadly in line with
the cash cost.
Our MVNO operations recorded revenues of £46.2m
(2005: £18.6m) and a loss of £9.6m (2005: contribution
of £1.9m), reflecting our investment in building this
segment. Our main goal for the year has been to
relaunch our UK MVNO operations. At the start of
The Carphone Warehouse Group PLC Annual Report 2006
12
Revenues grew by 40.1% year-on-year,
but margins fell as we invested heavily
in our broadband and MVNO strategies