Cable & Wireless says smartphones help mobile return to growth

Thu Nov 7, 2013 5:52am EST

* Mobile revenue in first half up 3 pct versus flat forecast

* Shares rise to two-year high

By Paul Sandle

LONDON, Nov 7 (Reuters) - Britain's Cable & Wireless Communications said its mobile services returned to growth in the first half, driven by the popularity of mobile data in its biggest markets of Panama and the Caribbean.

In his last set of results before he hands over to Phil Bentley, formerly of British Gas, chief executive Tony Rice said the bounce back in mobile put the group on track for the year.

"We have mobile growth across all regions, and we've made a good start in getting $100 million of costs out of the company," he said in an interview on Thursday. "Mobile revenue is up 3 percent, but mobile data was up 29 percent."

Mobile revenue was flat in its last financial year to the end of March, as declining voice calls offset growth in data used by smartphones.

Rice said the penetration of smartphones was now about 27 percent of customers, compared with 70-75 percent in Western markets, so there was plenty of room to grow.

Shares in the group rose 3 percent to a more-than-two year high of 47.9 pence as first-half core earnings of $298 million, up 3 percent, beat average forecasts of a flat result.

Deutsche Bank analyst David Wright, who sees a 1 percent rise in core earnings this financial year, said he was encouraged by further evidence of stabilisation in Panama, wider regional mobile data growth and increasing traction in cost cutting.

Rice said the disposal of the company's Monaco business had stalled - an outcome flagged earlier in the year - but the business was growing and the group would look at other options for the unit.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.