Cable and Wireless Communications (CWC), the London-headquartered telecommunications company which is a longstanding service provider in the Caribbean, today reported US$90 million in revenues and a four per cent increase in profits from its Barbados business during the first six months of the current financial year started last April.
“Our profits are slightly up by four per cent or US$33 million. So we are seeing a little bit of an uptick,” Chief Executive Phil Bentley told Barbadian reporters during a teleconference that coincided with the release of the company’s interim report on its performance during the first six months of the 2015 financial year.
“The main point is that we are investing and we invested US$26 million in Barbados,” he pointed out. “So we are pumping money into the island and looking to get a return on that investment.”
Bentley disclosed that mobile subscription was up about eight per cent in Barbados with smartphone penetration at about 63 per cent.
In general, C&W reported that after years of declining revenues due to competition, it had a realized an overall favourable increase in revenues during the period under review. Overall revenues were up four per cent, contributing to profits of $427 million.
Profits for the Caribbean region as a whole were up about 22 per cent.
Bentley said he was confident the business would continue to gain momentum, especially following the merger earlier this year with Columbus Communications Inc., a former competitor in the region. The merged entity is currently trading under the Flow brand in Barbados and it will be fully rolled out across the region subject to regulatory approval.
“Those of you who have been around the block for a significant amount of time would know that Cable & Wireless, as a Caribbean business, has historically declined year on year as it lost out to competition. Last year was the first year we stemmed those declines in the Caribbean. And this year is the first year we are actually showing some good growth,” reported an upbeat Bentley.
The C&W top executive said so far the company had spent some US$265 million across the region in building and upgrading networks. “We do feel that we are starting to see some momentum in business,” he added.
Bentley reported an increase of about 10 per cent in smartphone penetration on its network, which resulted in an increase of about 93 per cent in mobile traffic across its markets.
“We added some 300,000 customers in the first six months, quite a lot of that in Jamaica and some of it in Barbados as well as in Panama. And we are really getting some benefits if you like, from the merger, with Columbus,” he said.
Bentley said about 46 per cent of customers across the region currently had a smartphone but there was a decline for fixed line services. “…we are seeing broadband growth still in the business and this year we have signed off bigger investment in the fixed network,” he noted. “Last year, investment was heavily focused on mobile, 4G and LT markets but this year we are putting more money in our fixed networks.”
Bentley said the company was still awaiting final word from the Eastern Caribbean Telecommunications Authority (ECTEL) regarding the integration and rebranding of the businesses in St Vincent, St Lucia and Grenada in line with the merger.
He said so far, 103 of the company’s 130 stores have been rebranded to Flow. And while the company currently has two “flagship stores” – one in Montego Bay, Jamaica and one in St Kitts, Bentley said by the end of this year there should be another 12 across the region.
“The consequence of all that investment is that we have seen mobile data carrying up, in terms of revenue, up some 17 per cent in the first six months, and mobile data which used to be quite a small category compared to the whole mobile, is now over 40 per cent of total mobile revenue. I can see that overtaking voice as we look forward over the next couple of years,” Bentley said.
He said the company was moving towards “a data-led strategy” in which it would be more frequently offering calls in a bundled package with data.
Bentley said by the end of the year, the roll out of the fibre to the home network should be completed in Barbados. As a result, he expected a pick-up in broadband growth in the second half of the current financial year.
“Our TV business was pretty flat. It was up three per cent. We have had to disconnect some of our customers who haven’t paid for well over six months and sometimes 12 months . . . And as we look forward into the second half with a slightly lower base, we are expecting to see a growth in TV,” he said, explaining that growth was driven by content.