Everything Everywhere the parent company to Orange and T-Mobile have announced their Interim 2012 financial results indicating a 3.4% growth in Q2 2012 year on year, and strong customer loyalty with a low churn level of only 1.2%

Key highlights:

Strong progress integrating legacy businesses while driving consistent commercial momentum

Solid underlying service revenue growth of +3.4% (excluding regulated MTR cuts), with improving service revenue growth for the 3rd quarter in a row (+1.2% (Q4 2011) to +2.9% (Q1 2012) to +3.4% (Q2 2012); including impact of MTRs down 1.1%

Continued strong customer loyalty with low postpaid churn at 1.2% (Q2 2011: 1.1%); successfully upgrading customers to higher value postpaid plans, with average access fees +2.0% yoy

H1 adjusted EBITDA margin stable at 20.3% after additional 1.9ppts of margin invested in customer retention following 9% yoy increase in contract renewals

Smartphone adoption drives improvement in data revenues and customer value mix – with 50% of customers now on high value postpaid agreements; postpaid base +6.5% year on year; Q2 postpaid net adds of 150k; 91% (Q2 2011: 85%) of new postpaid customers are selecting smartphones; non-messaging data revenue up 11 ppts yoy at 29% (Q2 2011: 18%) of ARPU; non-voice revenues (data and messaging) up 8 ppts yoy to 47% (Q2 2011: 39%) of ARPU

Good progress on business integration – Network Optimisation integration programme now progressing rapidly; business has surpassed £316m (71%) of £445m annual gross opex savings target and is on track to savings of 3.5bn+ NPV by 2014

Olaf Swantee, Chief Executive Officer of Everything Everywhere, commented:

In the first half, we delivered a solid commercial performance, with good underlying revenue growth. We are making strong progress integrating the legacy Orange and T-Mobile businesses to create cost efficiencies and deliver planned synergy targets, while investing in significant network upgrades to further improve our customer experience.

Source: Everything Everywhere