Eir’s results for the third quarter and first nine months of its financial year had a familiar theme. Revenue down, earnings up.
It’s a trend that stretches back many years. To stay ahead of the game and satisfy its masters – be they investors, lenders or bondholders – Ireland’s biggest telco has had to cut costs at a faster pace than the decline in its legacy fixed-line revenues to keep the show on the road.
For the first nine months of the current year, its revenue fell by 2 per cent or €20 million while its operating costs declined by 8 per cent or €26 million. Its ebitda (earnings before interest, tax, depreciation and amortisation) rose by €15 million or 4 per cent.
Revenues in its legacy fixed-line business declined by 3 per cent in the first nine months of the year, while income from mobile was flat, in spite of the company having added 139,000 subscribers over the 12 months to the end of March. This demonstrates the brutal nature of the competitive landscape in the Irish mobile market.
Eir’s revenues have been in retreat for years. Income for the three months to the end of March amounted to €307 million. Wind back seven years (the year following its exit from examinership) and its third-quarter revenues were €338 million. They’ve steadily declined every year since.
The company’s net debt over the same period, meanwhile, has risen marginally from €2.1 billion to just shy of €2.4 billion, although the interest charged on this debt has reduced.
The latest results were also full of positivity, with glowing statements about the company’s progress in the rollout of 5G, its substantial capital investment in fibre broadband, the increase in the number of households passed, and a rise in customers for its television service.
Eir has been through much change in the past decade. But it is still has the look of a business in decline.
