Feeds

Pipex counts cost of competing with the big boys

Acquisitions hit profits, sell-off moves 'on track'

High performance access to file storage

Pipex told investors today its underlying profits suffered in 2006 because of borrowing to pay for rival ISPs Bulldog and Toucan, and home phone outfit Homecall.

Pre-tax profits, hit by bigger interest payments, sank to £4.8m, from £5.1m a year earlier. Margins fell away too, from 46 per cent in 2005 to 38.2 per cent last year, with Pipex blaming having to pay more line rental to BT because of the extra home phone customers it picked up in buy outs.

Pipex took on tens of millions in extra debt so it had cash to join in the feeding frenzy on ISPs last year, when many were looking to get out of the home bundle market which looks set to be dominated by just a few large firms.

Pipex said the review being carried out by bankers UBS, which was announced in March and will decide whether Pipex itself should make an exit, was "on track".

The board sniped at the press, which has reported that interests in an auction for Pipex from Sky, BT, TalkTalk, and Virgin Media all melted away during negotiations, calling it "highly speculative". Pipex said it will continue to explore its options, and expects to make an announcement once the review is completed in summer.

The acquisitions delivered a rise in sales of 121 per cent to £294m, since total subscriber numbers were boosted to over one million from under 300,000 at the beginning of the year. Broadband numbers went from 283,000 to 570,000. Total losses more than doubled, however, to £17.8m from £8.7m.

Pipex's full statement is here. ®

High performance access to file storage

More from The Register

next story
A black box for your SUITCASE: Now your lost luggage can phone home – quite literally
Breakfast in London, lunch in NYC, and your clothes in Peru
Broadband Secretary of SHEEP sensationally quits Cabinet
Maria Miller finally resigns over expenses row
Skype pimps pro-level broadcast service
Playing Cat and Mouse with the media
Beat it, freetards! Dyn to shut down no-cost dynamic DNS next month
... but don't worry, charter members, you're still in 'for life'
Like Google, Comcast might roll its own mobile voice network
Says anything's possible if regulators approve merger with Time Warner
EE dismisses DATA-BURNING glitch with Orange Mail app
Bug quietly slurps PAYG credit - yet EE denies it exists
Turnbull leaves Australia's broadband blackspots in the dark
New Statement of Expectations to NBN Co offers get-out clauses for blackspot builds
Facebook claims 100 MEEELLION active users in India
Who needs China when you've got the next billion in your sights?
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.