Virgin Media O2 posted net losses of more than £3.6bn in 2023 as it took a big hit on its projected future cash flows due to rising interest rates and a weaker macroeconomic backdrop.
Largely debt-funded, the mobile and broadband giant wrote back £3.1bn in the final quarter “primarily related to an increase in the weighted average cost of capital and the impacts of the broader macroeconomic conditions in the UK on estimated future cash flows”.
Total revenue for the year rose by 5.2% to £10.9bn, with 64,000 new broadband customers and 47,000 mobile customers added net.
Underlying profits before the goodwill adjustment and other one-offs rose by 4.2% to £4.1bn.
For 2024, VM02 said it expects at best revenues to be flat with a decline in underlying profits in the “low to mid-single digits”.
VM02 and its main competitor BT are in the middle of a huge roll-out of fast fibre broadband across the UK.
In 2023, VM02 passed a further 833,100 premises, with most of these part of the nexfibre FTTH network and making a fast fibre footprint of four million homes.
According to the statement, having spent £2bn in 2023, the fibre rollout is expected to accelerate further in 2024.
Lutz Schüler, chief executive of Virgin Media O2, said: ”Looking ahead, the 2024 outlook will be impacted by incremental investment in key initiatives to drive future growth, including increased marketing across our rapidly expanding fixed footprint."