Everything Everywhere shows significant growth in contract customers and maintains stable revenues through period of transition


London, 27th October 2010: The UK's leading communications company, Everything Everywhere – newly formed following the successful joint venture of T-Mobile and Orange in the UK earlier this year – today announced its financial results for the third quarter, 2010.

Operational highlights:

  • Strategic update given to investment community in London on 28th September.
  • Strong progress made on integration, with proposed reorganisation of the business announced on 30th September– involving a potential role reduction of approximately 1200 people.

Significant Q3 announcements included:

  • iPhone4 launched for T-Mobile UK customers in July.
  • In August, Orange became the first operator to launch High Definition Voice service in the UK with T-Mobile to follow next year.
  • Industry leading joint-network offer announced on 3rd September: More than 1 million Orange and T-Mobile customers already signed up to access the two national networks at no extra cost, as first phase of multi-network strategy to combine 2G, 3G, 4G, fixed broadband and WiFi in unique customer offer.
  • Orange announced as Microsoft's key partner for the new Windows Phone 7 whilst exclusively offering the flagship HTC 7 Mozart. T-Mobile also announced the ranging of Samsung's Windows Phone 7 handset, Omnia 7.

Third Quarter highlights: (all numbers consolidated)

  • Strong contract customer growth, with 19.6% YoY increase in net additions, from 155,000 to 185,000 in the quarter.
  • 43% of total mobile customers are contract customers, up from 40% at Q3 2009.
  • Consolidated figures for the new joint venture show continued progress with topline revenue growth of 0.1% to £1,773m. Underlying, pre-regulation growth was 2.5% YoY.
  • Continued growth in smartphone sales, now accounting for 75% of new contract joiners, up from 38% YoY.

Commenting on the results, Tom Alexander, Chief Executive Officer of Everything Everywhere said, "Despite challenging trading conditions and Everything Everywhere going through a period of transition, we've continued to grow our contract customer base with net additions up 19.6% year on year to 185,000. In addition to the significant progress we've already made towards integration, we have continued to focus on our day-to-day business, growing our customer base and maintaining revenues and returning to topline revenue growth.

"The UK market remains highly competitive, but once we get through our period of transition, and we are able to leverage both our scale and joint networks, as well as realise the proposed synergies, we expect to see further progress on improving our financial position.

"Our aspiration remains to give people instant access to everything everywhere, and with over 1 million customers already signed up to our national roaming joint-network deal, launched only a few weeks ago, it's great to see our customers already embracing the benefits of the new company."

Customer numbers: Total customers base grew 1.4% YoY to 27.9m.

  • Solid growth in contract customers continuing in the third quarter with net additions up 19.6% year on year, to 185k.
  • Total contract base now at 11.6m.
  • Prepay numbers declined in the quarter, with the total prepay base now standing at 15.5m. This was partially due to the continued customer migration to postpay contracts, witnessed across both brands.
  • Customer base mix continued to improve, with contract customers making up more than 43% of base, up from 40%; and 47% of new contract customers on 24 month contracts.
  • Marked improvement in contract churn, from 1.7% to 1.4%, YoY improvements offset by increased competition at lower price points.
  • Smartphone sales represented 75% of contract sales in the quarter, up from 38% in Q3 2009 and up from 64% in Q2 2010.

Revenues: Total revenues for the 3rd quarter grew by 0.1% with an increasing customer base accounting for £35m growth, and +£10m from non-voice revenues compensating a £1m drop in voice revenues.

  • Service revenues grew by 2.5%, excluding the impact of regulatory measures, which accounted for £43m. This is an improvement from the 2nd quarter where the comparable underlying revenue growth was 1%.
  • Contract and Pre-pay blended ARPU, post regulation, reduced by 1.0% YoY, but rose 1% against Q2 2010, to £19.3 per customer.


About EE

EE is the most advanced digital communications company in Britain, providing mobile and fixed line services to 27 million customers, and will soon become the first company in the UK to provide 4G mobile services alongside fixed-line fibre.

EE is the company that runs the Orange and T-Mobile brands in the UK, and will be launching its new superfast 4G brand – EE – in the coming weeks.

Its 4G service will cover a third of the population by the end of 2012 and its fibre service will cover 50% of the population by the end of the year.

EE's mobile service currently provides coverage to 99% of the population with 2G and 98% of the population with 3G

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