Virgin Media Posts £406m Profit As 58% Go For 30Mbps Or Above

Virgin Media posted positive first quarter results ahead of its imminent takeover by US cable company Liberty Global, citing strong demand for “superior broadband” as 58 percent of its customers now have speeds of 30Mbps or faster.

Revenues rose by 3.6 percent to £1.043 billion, contributing to pre-tax profits of £406 million during the quarter.

The company said that customers “are recognising the quality and value of Virgin Media services”, with subscribers demanding more services and faster speeds.

Virgin Media results

Virgin Media says that there has been a fundamental shift in broadband expectations, with 337,900 more homes now taking speeds of 30Mbps or faster, bringing the total number to 2.5 million.

Contract mobile customers increased by 35,100 to 1.7 million, while it added 171,900 new Tivo customers to a total of 1.5 million. The company says this makes it the fastest growing pay-TV company in the UK since the TiVo was introduced.

Customer retention rates are at their highest in three years, while Average Revenue per User (ARPU) is up by 5.2 percent to a record £49.39.

The number of subscribers who receive their telephone, Internet and television through triple-play packages is up to 65 percent, while the number of mobile customers increased by 35,100 to 1.7 million. Quad-play customers now represent almost 16 percent of Virgin Media’s total consumer base.

“We have had a good start to the year with accelerated revenue growth, improved churn, and strong free cash flow growth,” said Neil Berkett, Chief Executive Officer of Virgin Media. “The great value we provide through our Collections packages, which bundle superfast broadband and our next generation TiVo service, has seen new customers join and our existing customers stay loyal to us. This positive momentum in the business positions us well for our planned merger with Liberty Global.”

It was announced earlier this year that Liberty Global is to buy Virgin Media for £15 billion, but will continue to use the Virgin brand as part of a 30 year license deal.

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