O2 adds nearly one million contract customers in 2013


Operator reports its best annual performance in four years as it makes almost a quarter-of-a-million contract additions in Q4 

O2 added 983,000 contract customers last year, its best contract performance for four years. The figure was up by two per cent from 2012.

Of this, 222,000 were added in Q4, the eight successive quarter where the company has added more than 200,000 contract customers. The figure for the final three months from last year also represented an increase of 3,000 from Q3.

More than half (56 per cent/124,000) of new contract customers in Q4 chose O2 Refresh, which is the tariff that allows customers to change their handset whenever they want without penalty. This figure is up three per cent sequentially, taking the number of customers on the price plan to 1.1 million.

O2’s prepay base remained flat and ended the year with 10.76 million on that base.

This performance helped drive O2’s mobile contract base by eight per cent year on year, to 12.9 million, with the contract mix increasing by two per cent to account for 54 per cent of the mobile base. Overall, its total mobile customer base grew three per cent from 2012 to 23.6 million.

Churn remained at one per cent for the fourth successive quarter and in 2013 churn improved by 0.1 per cent to one per cent. Smartphone penetration in Q4 grew four per cent year-on-year to reach 49 per cent by the end of last year.

O2’s revenue grew 0.3 per cent from Q4 2012 to £1.46 billion and decreased by half a percentage point for the full year. Mobile service revenue in Q4 fell 6.1 per cent year-on-year to £1.12 billion. It said excluding the impact of mobile termination rate cuts and roaming regulation, this would have decreased 0.8 per cent annually and 1.3 per cent in 2013.

The operator also said its 4G network, which launched on August 29, 2013, now reaches 19 million UK people across 16 cities and more than 160 towns with 32 per cent population coverage. To date, one million O2 customers are paying for and using 4G.

Last year O2’s location-based loyalty programme Priority Moments saved its customers more than £20 million with special offers and discounts from UK brands including WH Smith, Halfords, The Body Shop, Caffe Nero and Odeon. O2 Priority Tickets helped customers get 700,000 tickets to concerts and events before general sale in 2013 – up almost a quarter (22 per cent) from the previous year.

O2 UK CEO Ronan Dunne (pictured) said: “We continue to offer our customers unique services and they are rewarding us with their loyalty and satisfaction. In 2014, we’ll be even more relentless in giving customers more reasons to join and stay with O2.”