3G costs doubles losses for Hutchison Australia

February 18, 2004

Australia mobile firm Hutchison Telecommunications said its net loss more than doubled in 2003 after heavy spending on its 3G mobile network. The company, which launched its high-speed mobile service in April 2003, said its full-year net loss widened to Aus $409.8 million (£1 = Aus$ 2.26) from a loss of A$197.3 million in 2002.

"This overall loss for the year is consistent with our business plan," Hutchison Chief Executive Kevin Russell said.

He said that "3's losses will be heaviest during the critical start-up period through 2003, 2004 and 2005 as we build our revenue base".

Hutchison Telecom said revenues for the period were up almost 50% at A$353.7 million, with its "3" 3G mobile network bringing in A$88.2 million to total sales. Its other mobile division, Orange, contributed A$221.9 million and also raised its user numbers to 325,000. The group anticipates it will have 1 million customers across the 3 and Orange businesses by the end of 2005

3 announced in December that it had around 86,758 subscribers in Australia with the average revenue per user (ARPU) at A$80. The subscriber figure now is estimated to be about 100,000. Hutchison has budgeted a total of A$3 billion for development of their 3G network.