Eircom, the Irish telco which is majority owned by a fund controlled by the troubled Australian bank Babcock & Brown, today reported an 8% increase in earnings for the year to the end of June.

Earnings before interest, tax, depreciation and amortisation (EBITDA) rose to €698m from €647m a year earlier Operating profits before once-off items jumped by 18% to €299m. Total revenue at the expanded 4% to just over €2 billion.

Commenting, Rex Comb, CEO Eircom, said,“The performance of the group over the past financial year has been very strong.  Revenue is up 4% at €2.06bn and adjusted EBITDA was €698 million, an increase of 8% on last year, reflecting consistent profitability in fixed line and continued growth in Mobile. This comes against a backdrop of strong competition in all of our markets.

In the Fixed Line segment, broadband take-up in Ireland continued to grow. Eircom added 138,000 subscribers during the past twelve months, bringing our total retail DSL and bitstream subscribers to 593,000 as of 30 June 2008, a 30% increase over the prior year. By 15 August 2008 this number had increased to 608,000, of which retail subscribers accounted for 434,000. Eircom estimates that broadband penetration in Ireland now stands at c. 26% of the population, up from 13% in January 2007.

Eircom continues successfully to maintain market share, with adjusted EBITDA and revenue in fixed line broadly in line with last year’s figures.

Meteor’s Mobile subscribers have increased by 12% in the year to 983,000 as at 30 June 2008.  Meteor revenues of €481m increased by 24% over last year and EBITDA increased by 78%.  During the year, we selected Ericsson to build for us the most advanced 3G network in Ireland. 3G network coverage continues to expand in line with the milestones outlined in the licence and an internal trial of 3G services is ongoing. The Group's share of the Irish mobile market stands at c. 19% of total subscribers.

We continue to make good progress on our target to reduce headcount in the Fixed Line business by 900 by 2010 through voluntary leaver programmes.  Headcount has fallen by 621 since June 2007.

In the last few weeks we have begun to re-locate staff to our new flagship office building at Number 1, Heuston South Quarter in Dublin. More than 1,500 staff will reside at the new building when the relocation is complete.

In the year to June 2008, Eircom’s cash outflow on capital investment was €331 million, almost half of the total estimated expenditure by the industry in Ireland.  In line with our commitment to invest €1 billion in total between 2006/07 and 2008/09 we have continued to extend our broadband rollout, the construction of our next generation core network for Ireland and the rollout of the country’s most advanced 3G network."

A director of the fund BCM that has a majority stake in Eircom has said it has no intention of selling the telecoms firm.

Responding to speculation sparked by problems at Australian investment group Babcock & Brown, Rob Topfer told RTE radio BCM was a stand-alone company with a separate board, and the financial situation at Babcock & Brown did not affect Eircom.

Mr Topfer said there was no pressure on BCM on Eircom, and "no intention to look to sell Eircom".

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