UK mobe network Three's profits hit by IT upgrade costs

Mobile operator Three UK reported a fall in earnings before interest, taxes, depreciation and amortisation (EBITDA)* of 2 per cent to £437m for its full-year results – largely due to an IT and network upgrade. Sales went up 7 per cent to £2.4bn for the 12 months ended 31 December 2017 (PDF). Capital expenditure rose 30 per …

[chivo243]

Li Ka-shing

What a name for one of the richest guys in Asia ~ Kashing! Cashing it in. Priceless!

[eswan]

Ka-shing out?

[julian_n]

They are also losing money because people try them once, realise how crap their coverage is, and go elsewhere.

I've just moved 3 contracts this year.

[DenTheMan]

20% profit

It reads like 20% profit on sales of £2.5 billion.

Not bad for a the minmow offering good consumer deals.

[Anonymous Coward]

Re: 20% profit

In turnover that's just under half the size of 02, which implies that O2 are a sardine.

As for the 20% "profit", see the footnote - that is before the cost of borrowing, tax, and planned writedown of assets. They might not have released the details yet, but for 2016, depreciation was £316m, amortisation was £49m, and interest was £6m a year. Those costs will be roughly similar in 2017, so the £437m EBITDA "profit" converts to a profit before tax of £66m, for a 2.75% pre tax margin.

In terms of return on capital employed (using net assets), they probably got a 1% return for 2017, which is dismal.

[ARGO]

Re: 20% profit

This makes me wonder if anyone at El Reg actually reads the things they link to. Both the 3UK PDF and the CKH PDF linked from the article state £437m as the EBIT figure, with EBITDA at £702m. Which is a healthier return.

But with CAPEX at £459m, and another £294m spent buying UKBB there is still a negative cash flow for the year. Which is not ideal....

[Anonymous Coward]

"realise how crap their coverage is"

No worse than anyone else here, but at least they have a decent WiFi Calling package - was with Vodafone, but they only had it on business packages and it didn't support SMS or voicemail.

[Lee D]

Re: "realise how crap their coverage is"

But mobile broadband... that's not just smartphones. Three got famous by being for the "data-heavy" user, they aren't going to be wandering around much.

And I have both Three (mobile Wifi) and Giffgaff (smartphone) and I don't think either of them are better than the other and not to the point of detriment for either of them.

[Vince]

YMMV of course, but my experience is entirely different. In fact in our office, the vast majority of the staff use 3.

[James 51]

The price of contracts with flagship contracts is eye watering. SIM only is better value.

[Come to the Dark Side]

"Three is something of a minnow compared to BT/EE and Vodafone, which respectively hold 42 and 9 per cent of immediately usable UK mobile spectrum. In contrast Three owns 15 per cent, and O2 some 14 per cent."

How does owning 15% make you a minnow when compared to someone who has only 9%?

[DavCrav]

"How does owning 15% make you a minnow when compared to someone who has only 9%?"

My guess, typo. 1) the numbers don't add to anywhere near 100%, and 2) Voda doesn't own 9%.

Edit: article has since been corrected. It's 29%.

[Anonymous Coward]

Ka-shing ...

... ka-CHING! The sound of money.

[m0rt]

Re: Ka-shing ...

My pocket makes that sound, sometimes. But I am certainly not rich.

[Doogie Howser MD]

Bullshit Bingo Klaxon

DIGITAL TRANSFORMATION!!!

DING!!!

[Anonymous Coward]

What's in a name?

They're called Three as in 3G right? They brought it to market first didn't they with their crappy handsets with free Skype calls. Fast forward fifteen years... why would I consider "Three"?

[Anonymous Coward]

Re: why would I consider "Three"?

Because:-

- They are BT or Vodashite

- They give me calls in the USA and Oz from my UK minutes.

- I get 4G at home wheras O2 gives me 3G on a good day and the masts are next to each other.

- When I have had a technical issue, I got to speak to someone who isn't from India (may have changed)

All for under £12/month on a one month rolling contract.

Yes, sometimes their coverage is a bit patchy but overall, I'm pretty satisfied.

[Anonymous Coward]

Why won't I consider "Three"

They allowed my details to be accessed by a third party via their upgrade system, when said system has no technical need for access to any of said details. (it should pass details entered by the operator to a server which says match or no match, not show the details). This was (reported to me) months after having left them due to no wifi calling / visual voicemail.

Signalwise, they were always great, their helldesk was in India when I had the misfortune of needing to call them.

[The Oncoming Scorn]

Every Trip Home I buy a Few 3 Sims.

Next trip back - Activate just before I get on the plane, put 10 quid on it & then convert to a "Add-On" with that balance to get me 1GB Data, 3000 mins, 3000 texts. Then buy a few more for next time.