3UK triples half-year operating profit

The UK arm of operator group Hutchison Whampoa said it has more than tripled its operating profit year on year during the first half of 2013. 3UK generated £86m in the first half of 2013, a 231 per cent increase on the £26m it pocketed in the first half of 2012.

Total revenue grew nine per cent to £1bn in 1H13 compared with £918m in 1H12. The operator’s EBITDA margin grew from 11.8 per cent in 1H12 to 18.8 per cent in 1H13, which the firm attributed to growing customer numbers and effective cost management.

3UK added 168,000 net new customers in the second quarter of the year, bringing active customers to over 7.5 million – a ten per cent increase year-on-year. According to the firm, this growth largely came from high-value contract smartphone customers.

CFO Richard Woodward said that the performance was driven by new, high-value smartphone customers and a continued focus on cost efficiency.

“We’re attracting more and more customers, but importantly these are very engaged customers, delivering growth to the bottom line.”

The operator said that its store upgrade programme and advances in its online capability helped direct contract smartphone sales grow to 87 per cent, adding that its prepay customer base also grew, despite an industry wide decline.

“We believe the prepay market presents a real opportunity for growth and we’re looking forward to growing our share with the UK’s simplest, clearest and best value prepay offer,” added Woodward.

The operator is currently preparing to launch LTE services after acquiring 2 x 5 MHz of 800 MHz for £225m in the February 2013 UK LTE spectrum auction. Prior to that it also acquired 2X15MHz of 1800MHz spectrum  from rival EE, in line with the European Commission’s competitive assessment of the merger of Orange and T-Mobile in the UK in March 2010.

However, a source close to both EE and 3UK told that 3UK could face a wait until October 2013 before it is able to launch services using the spectrum.

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