CK Hutchison’s Europe-focused telecoms division highlighted continued strong competition from Iliad Italia and MVNOs as it booked a drop in Q3 year-on-year earnings in Italy, its largest revenue generator.
Its Italian Wind Tre operation contributes almost half of revenue at CK Hutchison Group Telecom, which also comprises the multinational’s mobile units in the UK, Sweden, Austria, Denmark, Ireland and Hong Kong alongside other smaller divisions.
Revenue for the group was down five per cent year-on-year in Q3 to €2.55 billion, with earnings in Italy dipping five per cent to €1.19 billion. Its second largest operation, 3 UK, booked a two per cent increase on Q3 2019 to £603 million (€670 million).
Explaining its Italy performance in a trading update announcement, the company bemoaned “aggressive competition” from relative newcomer Iliad Italia and MVNOs, though conceded the situation had eased slightly during the local Covid-19 (coronavirus) lockdown.
Although its takings had been impacted by the pandemic so far in 2020, it noted the trend had stabilised in Q3, at least in Italy.
The group said Wind Tre had retained a healthy margin in the country as a result of “customer value management initiatives”. It also highlighted a 14 per cent reduction on Capex compared to Q3 2019.
In the UK, it noted an improvement in the proportion of contract customers in its base and pointed to stable margins. However, it also noted there was a “volatile market landscape” in the country due to the resurgence of the Covid-19 pandemic towards the end of Q3.
The division does not report profit figures, which are included in the full CK Hutchison Q3 results statement, numbers yet to be divulged for the period.
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