Cable & Wireless Communications, the UK’s second largest cable TV and telephony company, has finally confirmed a definite date for the roll out of its digital cable television service. CWC’s digital TV will be commercially available from 1 July 1999 through trials. The complete service, with digital interactive offerings, will be available to customers in Manchester and London from October. Details of its DTV service will follow on Newsline.
However, the cost of setting up DTV is high. The cable company expects the extra spend on marketing and customer services to come to £60 million in the current financial year, depending upon the take up of the new services.
Chief executive Greg Clarke commented: “Digital television in particular is an investment for future profitable growth. In the short term it will reduce growth in consumer markets in 1999/2000 as our customers switch from analogue to digital. In addition, to ensure that digital television is successful, significant extra investment in marketing and customer service is planned.”
The company announced a 15% increase in revenue to £2.62 billion for the year ended 31 March 1999. Operating profit rose 17% to £331 million, and earnings per share were up to 9p per share from a loss of 3.2p last year. Pre-tax profit was £140 million, below analysts’ expectations.
Commenting on the group’s results, Clarke said: “We have continued to deliver strong profit growth, increased operational efficiency and improved customer service, securing revenue growth in all four of our business units for the first time. Underlying operating costs have been driven down to just 22% of revenues, despite a 29% increase in volumes.”
Cable & Wireless confirmed at the beginning of last month that it was in talks with another UK cable company, Telewest, about the possible transfer of various CWC and Telewest businesses (see Newsline).
Cable & Wireless Communications: 0171 674 5440
