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Virgin Media halves losses in 3Q09 as network upgrade kicks in

Virgin Media's losses halved in 3Q09 to £60.1m from £122.7m the previous quarter, bringing net losses for the first nine months of this year to £263.4m, compared to £676.0m a year ago.

Total sales were up 1.3% to £953m, with free cashflow strong at £109m. Average monthly revenue per user rose 5.3% to £44.24 compared to £42.00 for 3Q08, as customers bought more of the firm's offerings.

Customers using Virigin broadband, TV and telephony rose to just under 60% from less than 55%, and the number of customers adding a mobile phone on top of this rose to just over 10%.

Virgin Media completed its network upgrade, making access speeds of up to 50Mbps available, and raising its entry-level speed from 2Mbps to 10Mbps.

It added 39,000 broadband customers during the quarter, bringing the total to 3.77m. Some 72% of subscribers now have access speeds greater than 10Mbps, while those with 20Mbps or higher access rose 40% to 500,000 or 13% of subscribers.

Just over half Virgin Media's digital customers used the video-on-demand service, up from 49% a year ago. This pushed average monthly total viewings to 66 million per month from 45 million.

Mobile phone contracts, which are serviced by T-Mobile, were up 51%, adding 88,000 to 872,600. T-Mobile UK is the object of a takeover by Orange.

CEO Neil Berkett said the company aimed to attract high-value customers who bought more and stayed longer. "This strategy has led to the second-successive quarter of record ARPU and strong consumer revenue growth," he said.


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