Telewest Looks To Turn Corner In Second Half
Telewest Communications today announced reduced losses for the first six months of 2003 as it prepares to hand control to bondholders in a debt-for-equity swap.
Subscriber numbers continue to fall with 24,000 customers having abandoned Telewest this year but churn is down to a record low of 16% and managing director Charles Burdick believes that the latest results mark the start of a turnaround.
“The heavy investment on our network is behind us and we are now benefiting from our advanced infrastructure quality requiring lower capital expenditure,” he said in a statement. “We expect to build on this in the second half, and July shows our initiatives starting again to grow sales.”
The increase in broadband demand has helped to fuel the recovery of the UK cable sector (see UK Cable Broadband Tops One Million Households). Telewest’s internet and other revenues grew by 62% to £55 million in the first half of 2003 and the operator now has 329,000 broadband subscribers, an increase of 10% since March.
Burdick said that a primary objective is to drive up average revenue per user (ARPU) by encouraging more customers to take up the “triple play” option of telephone, television and internet.
Telewest remains £5.3 billion in debt but announced this week that it had negotiated new terms with bondholders over a financial restructuring that will slash £3.5 billion from this total. The main losers are shareholders who will be left with just 1.5% of the company (see Telewest To Reduce Shareholder Stake).
Shares in Telewest were down marginally at 1.63p at 12:30 today.
