Report Overview

O2 UK: Lower costs mitigate the challenging environment

­­­­O2’s service revenue growth slipped decisively into negative territory at -1.8% this quarter as the punishing regulatory regime took its toll

Underlying EBITDA growth of 4% was particularly impressive in the circumstances; likely aided by more direct distribution as well as tight cost control

The coming week will unveil how this compares to peers; we anticipate results which reflect a tough environment with little let-up on the horizon

Contents

New issues layered on old

‘Other mobile’ revenue fails to mitigate ARPU pressure

EBITDA strong – direct distribution a likely boost

No let-up on sector outlook

5G launch announced, O2 last but not least

List of charts/tables

Figure 1. Organic EBITDA and mobile service revenue growth

Figure 2. O2 KPIs

Figure 3. Reported organic mobile service revenue growth

Figure 4. Contract net additions (000s)

Figure 5. Service revenue growth and ARPU-based service revenue growth

Figure 6. Non-ARPU service revenue (€m)

Figure 7. O2 non-ARPU service revenue growth

Figure 8. Outlook for change in mobile trends in 2019 by operator

Figure 9. SIM-only pricing by data allowance

Figure 10. SIM-only unlimited data pricing

Figure 11. 5G launch dates and plans