Three doubled operating profit to £207mln in 2013

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The operator also added 565,000 during the year to bring its total base to 7.9 million

Three doubled its operating profits from £101 million to £207 million during 2013.

Revenue increased five per cent to pass the £2 billion milestone.

The operator added 565,000 customers last year to bring its total to 7.9 million. Although Three declined to give a prepay/postpay breakdown, it said its contract base grew 12 per cent.

Chief financial officer Richard Woodward said the “quality” of customers increased as well as the quantity, with average margin per user (AMPU) rising just over one per cent to £12.05.

Customer service margin – the money left over after Three deducts handset contribution and interconnection costs – also increased, by £118 million, or 12 per cent, to £1.1 billion.

Woodward said: “2013 saw Three become a more profitable business. Our operating profit rise is particularly impressive when you consider we only broke even in 2011.”

Cheap marketing

Total operating costs – which includes advertising and the cost of acquiring and retaining customers – fell by £14 million in 2013.

Woodward attributed this partly to the success of customer-led marketing campaigns, such as Socks the Pony which launched last year and allowed customers to create their own videos featuring the shetland pony.

It is hoping to achieve the same cost efficiencies with its new campaign ‘Singitkitty’ which allows both Three customers and non-Three customers to feature in videos. It has already reached four million hits on youtube.

“We are very pleased with the way we are running our business cost efficiently,” Woodward said.

 

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