CWC exceeds expectations as pre-tax profits double
Tuesday 11 November 1997
Cable & Wireless Communications (CWC), Britain's biggest cable telephone and TV group, announced that its pre-tax pre-exceptional profit more than doubled to pounds 65m in the six months to September, and would comfortably meet its cost-cutting target of pounds 100m a year. Analysts had been expecting profits between pounds 50m-pounds 65m, excluding a pounds 200m exceptional charge for redundancies and writedowns. The company's shares rose 5p to 233p.
Graham Wallace, CWC's chief executive, said: "Despite the demands of the reorganisation following the merger, we have increased revenue, profits and the number of customers, while introducing new products and improving customer service."
CWC was formed when Cable & Wireless, its majority owner, merged its Mercury subsidiary with the UK cable operations of North American groups Nynex CableComms, Bell Cablemedia and Videotron.
CWC's revenues in October had continued to grow at the same rate as they did in the first six months of the year, Mr Wallace said. First-half revenues rose12 per cent to pounds 1.1 bn, compared to pro-forma figures for last year. Meanwhile, the number of homes subscribing to CWC's phone and TV services grew by 40 per cent to more than 1 million in the past 12 months. Mr Wallace said he expected about 100,000 of those households to upgrade to digital television services in the first year after their launch.
CWC and BSkyB agreed last week to coordinate the launch next spring of their digital services, which promise more channels and better video and audio quality.
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