News
U.K. telco warns greater regulatory pressure will hit financial performance during 2016.
EE on Friday announced it hits its target of reaching 14 million 4G customers by the end of 2015, giving it the largest 4G subscriber base of any operator in Europe.
However, it also posted flat fourth-quarter revenue and warned that it faces regulatory headwinds in 2016.
The U.K. telco generated revenue of £1.61 billion (€2.07 billion) in the three months to 31 December, compared to £1.62 billion in the same period a year ago. Mobile service revenue fell 2.5% year-on-year to £1.38 billion.
EE’s branded mobile customer base edged down to 24.19 million from 24.48 million, as growth at the postpaid division was once again offset by a decline at the prepaid division. EE said its 4G customer base increased to more than 14 million from 12.6 million at the end of September.
Meanwhile, growth in machine-to-machine (M2M), MVNO, and fixed broadband customers meant that the company’s overall network connections increased to 31.48 million from 30.94 million in the fourth quarter of 2014.
For the full year, EE’s revenue edged down to £6.31 billion from £6.33 billion in 2014, while adjusted EBITDA increased to £1.78 billion from £1.59 billion. EE said operating revenue declined 0.6% year-on-year due to regulatory pressure. The company warned that it expects these pressures to increase throughout 2016, with higher spectrum licence fees as well as reduced roaming rates and mobile termination rates hitting its financials from 2016 and beyond.
Nonetheless, EE’s new chief executive, Marc Allera, said in a statement that "2015 was an exceptional year for EE, as we met and exceeded 4G targets, won multiple awards for our network performance, and improved our customer satisfaction scores,"
Of course, dramatic changes are underway now that EE is owned by BT.
EE will become a separate consumer-facing line of business within the U.K. incumbent headed up by Allera. EE’s enterprise operation will become part of BT’s newly-formed Business and Public Sector unit.
"As part of BT, we’re entering the next chapter of EE’s journey, and look forward to a phenomenal opportunity to innovate for the benefit of our customers, while continuing to build and enhance the U.K.’s digital infrastructure," Allera said.
