Menu
21/05/2003
MM02 blames £10.2bn loss on 3G 'overpayment'
Mobile phone company MM02 has revealed a massive year-end loss of £10.2 billion.
The mobile communications operator blames the majority of the losses on huge overpayments for third-generation mobile phone licences.
MM02 has been forced to revalue its overall assets in a £9.6 billion write-down conceding that the exceptional one-off cost of 3G licences has substantially contributed to the bulk of the deficit.
At the height of the telecoms boom, the 3G licences were bought at what is now widely acknowledged were wildly overvalued sums. The problems were compounded as the value of telecoms assets later plummeted in continuing difficult trading conditions on the world stock markets.
Three years ago MM02, formerly BT Cellnet, paid £4 billion for the 3G licences auctioned by the UK government. However, pressures on the telecom industry, ironically much of which is now attributed to the inflated price paid for the 3G licences, led to billions being wiped off the values of many telecom companies’ assets as the sector value realigned.
While the market for the sophisticated 3G phones is expected to materialise, it is anticipated that this will take place over a much longer timescale than was originally envisaged when the licences were purchased.
MM02 insist that the underlying mobile communications business remains strong.
David Varney, Chairman of mmO2 plc, said: "In these year-end results, the size of the exceptional charges we have taken has masked the strong underlying performance delivered in our first full year as an independent company. However this impairment enables us to go forward with a balance sheet that reflects realistic assumptions about the potential of our business to grow, and to deliver attractive returns for shareholders.”
On the positive side, turnover for MM02 for the year-end in March 2003 was £4.87 billion, up 14% on the £4.28 billion in 2002.
The loss made by MM02 before exceptional items that included the 3G licences was reduced from £337 million in 2002 to £104 million in 2003.
(SP)
The mobile communications operator blames the majority of the losses on huge overpayments for third-generation mobile phone licences.
MM02 has been forced to revalue its overall assets in a £9.6 billion write-down conceding that the exceptional one-off cost of 3G licences has substantially contributed to the bulk of the deficit.
At the height of the telecoms boom, the 3G licences were bought at what is now widely acknowledged were wildly overvalued sums. The problems were compounded as the value of telecoms assets later plummeted in continuing difficult trading conditions on the world stock markets.
Three years ago MM02, formerly BT Cellnet, paid £4 billion for the 3G licences auctioned by the UK government. However, pressures on the telecom industry, ironically much of which is now attributed to the inflated price paid for the 3G licences, led to billions being wiped off the values of many telecom companies’ assets as the sector value realigned.
While the market for the sophisticated 3G phones is expected to materialise, it is anticipated that this will take place over a much longer timescale than was originally envisaged when the licences were purchased.
MM02 insist that the underlying mobile communications business remains strong.
David Varney, Chairman of mmO2 plc, said: "In these year-end results, the size of the exceptional charges we have taken has masked the strong underlying performance delivered in our first full year as an independent company. However this impairment enables us to go forward with a balance sheet that reflects realistic assumptions about the potential of our business to grow, and to deliver attractive returns for shareholders.”
On the positive side, turnover for MM02 for the year-end in March 2003 was £4.87 billion, up 14% on the £4.28 billion in 2002.
The loss made by MM02 before exceptional items that included the 3G licences was reduced from £337 million in 2002 to £104 million in 2003.
(SP)
Related UK National News Stories
Click here for the latest headlines.
13 January 2014
Total Acquires 40% Interest In Shale Gas Exploration Licences
Total has announced that it has acquired a 40% interest in two shale gas exploration licences in the United Kingdom. The interests are in Petroleum Exploration & Development Licences 139 and 140 in the Gainsborough Trough area of the East Midlands region of the UK, which cover an area of 240 km2.
Total Acquires 40% Interest In Shale Gas Exploration Licences
Total has announced that it has acquired a 40% interest in two shale gas exploration licences in the United Kingdom. The interests are in Petroleum Exploration & Development Licences 139 and 140 in the Gainsborough Trough area of the East Midlands region of the UK, which cover an area of 240 km2.
07 July 2015
All New Licences To Feature Union Flag
All new drivers licences issued in England, Scotland and Wales will now feature the Union Flag alongside the existing European Union flag.
All New Licences To Feature Union Flag
All new drivers licences issued in England, Scotland and Wales will now feature the Union Flag alongside the existing European Union flag.
07 July 2014
Awareness Campaign Launched Over Fake Govt Websites
The National Trading Standards Board has launched a campaign to raise awareness of fake government websites, charging people for services that are free. It follows the arrest of five people last week in connection with websites make to look like official government sites.
Awareness Campaign Launched Over Fake Govt Websites
The National Trading Standards Board has launched a campaign to raise awareness of fake government websites, charging people for services that are free. It follows the arrest of five people last week in connection with websites make to look like official government sites.
17 July 2013
RAC Propose Change To Drivers License
The RAC Foundation has called for a new system of graduated licences for learner drivers in the UK, claiming it would reduce the number of road deaths. The new system would consist of three stages spread across four years. The stage would be: • Stage one A minimum 1 years experience driving, before, taking the test.
RAC Propose Change To Drivers License
The RAC Foundation has called for a new system of graduated licences for learner drivers in the UK, claiming it would reduce the number of road deaths. The new system would consist of three stages spread across four years. The stage would be: • Stage one A minimum 1 years experience driving, before, taking the test.
15 October 2012
Met Accused Of Using Honey-Trap To 'Create Crime'
Police have been accused of using a covert pawnshop as a “honey-trap” to lure young people to commit crimes. More than 100 people are believed to have been convicted, many for illegally trading passports and driving licences, at the covert Scotland Yard store in Cricklewood, north London.
Met Accused Of Using Honey-Trap To 'Create Crime'
Police have been accused of using a covert pawnshop as a “honey-trap” to lure young people to commit crimes. More than 100 people are believed to have been convicted, many for illegally trading passports and driving licences, at the covert Scotland Yard store in Cricklewood, north London.
-
Northern Ireland WeatherThis Evening and Tonight:A dry night, save for a few light showers around the coasts, with prolonged clear spells and light winds bringing a frosty dawn for many in central and southern parts. Minimum temperature -3 °C.
