September 1, 2017 / 10:25 AM / a year ago

Iliad profit rises on subscriber gains

PARIS (Reuters) - French telecoms operator Iliad (ILD.PA) said profit rose 22 percent in the first half as the provider of low-cost internet and mobile services continued to win new business from rivals Orange (ORAN.PA), Bouygues (BOUY.PA) and SFR SFRGR.PA.

French broadband Internet provider Iliad logo is seen in Paris, France, March 10, 2016. REUTERS/Charles Platiau/File Photo

Net income rose to 232.6 million euros in January-June from 190.4 million a year earlier, the company sad in a statement, on a 7.3 percent increase in revenue to 2.46 billion.

The owner of the Free internet and mobile brand, whose 2012 market launch sparked a price war in France, also posted 874.6 million euros in earnings before interest, tax, depreciation and amortisation (EBITDA), up 8.2 percent.

The group said it added 200,000 net new mobile subscribers in April-June, winning the biggest share of new business among French mobile operators for the 22nd consecutive quarter. Total subscribers including fixed-line rose to 19.61 million at the end of June from 18.34 million a year earlier.

In fixed-line, however, Free saw its profitability decline slightly in the first half with a slowdown in subscriber additions that billionaire founder Xavier Niel blamed on “aggressive” sales promotions by Bouygues and other rivals.

In response, the group will now push ahead with the development of a long-awaited successor to its current Freebox offering, Niel said, without giving a launch date.

“In such conditions it’s the quality of our boxes that wins new business,” he said on a conference call with analysts. “We’ve tried to hold back but at some point you can’t wait any longer, so we’ll be back with a new box.”

Iliad reiterated full-year and medium-term goals including a 40 percent EBITDA margin by 2020, compared with 35.5 percent recorded in the first half.

In Italy, where the company is preparing its first overseas expansion, Iliad may be interested in acquiring 5G wireless spectrum in an upcoming government auction, Chief Executive Maxime Lombardini also said on Friday.

Reporting by Laurence Frost and Gwenaelle Barzic; Editing by Leigh Thomas

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