Eircom makes 52 M loss after restructuring and write down.

SkepticOne

Articles by Jamie Smyth in today's Irish Times report that Eircom made a loss of 52 million after significant restructuring and writing down of asset values.

Eircom reduced its operating costs to €1.86 billion, down from €2.07 billion in 2001, in part due to its redundancy programme, the closure of its international divisions and the introduction of more efficient work practices.

A number of exceptional items detailed in the accounts caused the massive increase in losses at the group. Write downs on the value of Eircom's network, its property portfolio and the closure of the group's international businesses cost the group almost €70 million.

The regulatory accounts give a detailed breakdown of how each Eircom division performed during the year to March 2002. These show its retail business lost €10 million reversing a €12 million profit in the previous 12 months.

In another article by the same journalist:

Eircom chief executive, Mr Philip Nolan, can shoulder little of the blame for the financial performance outlined in the new figures, as he was at the helm for just three months during the period. But Mr Nolan is sure to use the financial loss to lobby the telecoms regulator to remove the current price cap on Eircom.

dahamsta

Eircom reports EUR52m in 2002 losses

Eircom's turnover fell by EUR370 million in its last fiscal year, hurt mainly by the sale of Eircell and asset write-downs, according to official documents.

Although no longer a publicly quoted company, Eircom is still required to publish certain financial statements due to its significant market power (SMP) in Ireland, under a directive from the government. According to this latest filing, Eircom's turnover in the year to 31 March 2002, was EUR1.78 billion, compared to last year's turnover of EUR2.15 billion.

The 2001 figure however included the revenues of Eircell, the mobile phone company that was sold to Vodafone in mid-2001. For the year to March 2002, Eircell added just EUR95 million in revenue to Eircom's books, compared to a massive EUR705 million in the previous year. This equates to a loss of EUR47.8 million for Eircell in Eircom's 2002 fiscal year, whereas in FY2001 the mobile phone business made a EUR67.6 million profit.

As a group, Eircom's fall in revenues created a pre-tax loss of EUR52 million in FY2002, compared to a profit of EUR66 million in the previous year. Along with Eircell's losses, other figures that contributed to Eircom's deficit included EUR70 million in write-downs on the value of its network and its property portfolio, as well the closure of some international businesses.

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Dangger

Interesting to see that the home Internet provision business unit was one of the only profitable units in the company! Oh that and the leased line unit also!

What a surprise!!!

gurramok

Originally posted by Dangger
Interesting to see that the home Internet provision business unit was one of the only profitable units in the company!

What a surprise!!!

Oh, just to add...they have €1500 less from me in last 12 months due to my own little 'cutback' in net usage