- Number of O2 TV customers subscribed for any of M, L or XL monthly tariffs and those watching television on the web or in application increased by almost a half year-on-year; thus O2 registers already 889 thousand active accesses.
- Substantialinterest in attractive exclusive sport content and successful proposition of O2 Spolu bundled packages for families, groups of friends and entrepreneurs were the key drivers of the growth.
- O2 expanded its Internet HD proposition with a new generation of 5G wireless technology in 3.7 GHz band. At the end of March 2019, O2 registered 811 thousand customers of its technology agnostic broadband internet.
- Consolidated revenue went up 0.5% year-on-year to CZK 9.2 billion in the first quarter 2019, with improving fixed revenue year on year trend.
- Consolidated EBITDA grew by over 11% to CZK 2.9 billion, higher investments into growth areas led to a 7% decline in consolidated net income to CZK 1.2 billion.
"In the first quarter of 2019, we continued bringing many innovations to our customers. Since February, we have been offering new FREE tariffs with a larger portion of data without a price increase. By aggregation of several frequency bands, in Kolín, we launched a mobile network with a theoretical speed of up to 1 Gbps, which is the next step of preparation for 5G. Our new O2 Smart Booster will extend the Wi-Fi signal from the O2 Smart Box smart modem to longer distances, making it the ideal solution for family houses, large apartments and business buildings,"comments Jindřich Fremuth, Chief Executive Officer and the Chairman of the Board of Directors of O2 Czech Republic on the results, and adds: "We continue to promote successful O2 Spolu bundled packages. This also helped us to increase number of customers of our monthly O2 TV tariffs by more than 25 thousand in the first three months of this year."
"Our investments in the last year of which a substantial part was directed in the network, led to an increase in depreciation and a year-on-year decline in net income in the first quarter of 2019," explains Tomáš Kouřil, the company' s Chief Financial Officer and Vice-Chairman of the Board of Directors, and adds: "The year-on-year EBITDA growth confirms that our decision to invest into growth areas has been strategically correct."
Overview of key events in the first quarter 2019
O2 has expanded the availability of its broadband Internet using wireless technology. It commenced offering customers residing out of fast cable connectivity reach a new generation of 3.7 GHz wireless Internet, bringing them home broadband Internet speeds of up to 250/25 Mbps that were previously available only through cable.
Since February, O2 has been offering new FREE tariffs. For all customers who opt for a special two-year offer, O2 provides double the data package for the same price. The new FREE tariff portfolio is designed for both new and existing customers who can switch to them from existing tariffs.
As a part of the preparation for the arrival of fifth-generation networks, O2 was the first in the Czech Republic to cover the entire city of Kolín with the currently the fastest internet. The technology enables data transfers with theoretical speeds of up to 1 Gbps, which is ten times faster than the conventional 4G LTE network. These speeds can be achieved by aggregation of several frequency bands  and complementation with 4x4 MIMO and 256QAM technologies. O2 customers who would enjoy the fastest connection in Kolín, they need a smartphone with LTE Cat 16+ and higher.
Since April, O2 has been offering O2 Smart Booster. It extends the fast Wi-Fi from O2 Smart Box device even further, making it the ideal solution for family houses, large apartments and business buildings. As with all devices from the O2 smart modem family, the O2 Smart Booster can be controlled easily with the O2 Smart Box app. O2 Smart Booster set up is very easy. In addition, the Mesh feature enables customers to connect more O2 Smart Boosters and cover very large spaces with Wi-Fi network.
Thanks to the successful proposition of O2 Spolu bundled packages and continuing popularity of new O2 Data tariffs, the total number of mobile registered customers  reached 5,563 thousand at the end of March 2019. The number of mobile contract customers was at 3,509 thousand, while the number of mobile prepaid customers stood at 2,055 thousand.
In O2 network, smartphones represent close to 75% of handsets and 60% of total handsets support LTE technology.
The larger portion of data volumes included in FREE tariffs along with customers' interest in O2 Data tariffs with a monthly data volume of 4 to 20 GB and with an increase in the number of customers with a 4G LTE-enabled smartphone contributed to a 25% year-on-year increase in mobile data usage generated in handsets. Again, data transmissions were clearly dominated by video.
While the number of SMS sent continued to decline during the first quarter, the volume of data transmitted in communication via so-called messengers increased - the most popular are Snapchat, WhatsApp and Facebook Messenger.
The number of O2 TV tariffs customers provided over O2 fixed line (IPTV) as well as over internet connection from any provider (OTT), reached 361 thousand as at 31 March 2019. Of that, 45 thousand households subscribed for the increasingly popular complementary MULTIservice, which enables customers to watch TV on multiple TV sets at once. Customers are granted up to 4 free of charge licenses to each tariff enabling them to watch the entire O2 TV content on the web or in mobile applications. Close to 530 thousand viewers used this opportunity on a regular basis in the first quarter 2019, including customers of O2 TV Sport Pack package. As of the end of March 2019 O2 registered close to 890 thousand O2 TV active accesses  .
Number of broadband internet customers  over cable as well as the wireless technology reached in total 811 thousand as of 31 March 2019.
O2 Slovakia keeps recording increasing demand for its O2 Pausal mobile tariffs portfolio. As of 31 March 2019, the total customer base reached 2,048 thousand. Contract base amounted to 1,296 thousand and it represented 63.3% of total base, up by 3.4 percentage points year-on-year.
Total consolidated operating revenue reached CZK 9,249 million in the first quarter 2019, up 0.5% year-on-year. Operating revenue in the Czech Republic declined slightly by 0.3% to CZK 7,469 million, as a 0.4% growth of mobile revenue to CZK 4,851 million did not fully compensate a 1.5% year-on-year decline in fixed revenue to CZK 2,618 million. Mobile data, financial services and O2 TV were the key revenue growth drivers.
In Slovakia, total operating revenueimproved by 2.9% to EUR 72 million in the first quarter 2019. In Czech koruna (CZK) the operating revenue reached CZK 1,839 million, up 4.1% year-on-year. Similarly to the Czech Republic, higher mobile data revenue was the key growth driver.
Consolidated earnings before depreciation and amortisation EBITDA improved by 11.5% year-on-year to CZK 2,906 million in the first quarter 2019,thanks to the higher revenue, its better profitability, savings in majority of costs and a positive impact of the new IFRS 16 accounting standard. In the Czech Republic, EBITDA grew by 10.4% to CZK 2,191 million, while Slovakia reported a 16.3% increase to CZK 723 million (+15% to EUR 28 million). Consolidated EBITDA margin improved by 3.1 percentage points to 31.4% in the first quarter 2019.
Consolidated net profit declined by 7% year-on-year reaching CZK 1,236 million in the first quarter 2019 as higher investments into growth areas in 2018 led to depreciation & amortisation growth.
KEY FINANCIAL INDICATORS OF THE GROUP
|Financial indicators||1Q 2019||1Q 2018||Year-on-year change|
- CZ mobile revenue
- CZ fixed revenue
- SK revenue
CZK 9,249 mil.
CZK 4,851 mil.
CZK 2,618 mil.
CZK 1,839 mil.
CZK 9,189 mil.
CZK 4,831 mil.
CZK 2,658 mil.
CZK 1,767 mil.
-of which operating costs
CZK 6,353 mil.
CZK 1,900 mil.
CZK 6,604 mil.
CZK 2,005 mil.
|EBITDA||CZK 2,906 mil.||CZK 2,606 mil.||+11.5 %|
|EBITDA margin||31.4 %||28.3 %||+3.1 p. p.|
|Net profit||CZK 1,236 mil.||CZK 1,329 mil.||-7.0 %|
 LTE 800 FDD, LTE 1,800 FDD, LTE 2,100 FDD, LTE 2,600 FDD
 Since 1Q 2019, it comprises mobile customers who have generated revenue for the past 13 months and excludes Internet HD mobile customers using 4G LTE and WTTx wireless technologies; comparable data for the previous period have been adjusted.
 IPTV/ OTT including MULTI, web and mobile apps accesses
 Fixed (xDSL, fiver), wireless (4G LTE, WTTx)