Virgin Mobile turns profitable

2009-11-10

Virgin Mobile South Africa is pleased to announce that the company generated a positive operating profit at the end of October 2009 and expects to remain EBITDA positive going forward. Virgin Mobile launched in June 2006, promising value and transparency to South African consumers. It was initially difficult for the company to make headway given the unjust interconnect environment and the enormous marketing spend of the existing operators.

In the last 12 months, however, Virgin Mobile has gained market share, improved customer service and reduced overheads.

Great deals such as 1000 Free SMS’s per month have enabled the company to grow to over 200,000 subscribers with an industry leading blended ARPUof over R200. Focusing its marketing and sales on the value-seeking mid-market segment, Virgin Mobile is becoming well known for offering simple, no-nonsense cellular connectivity at decent rates.

Going forward, Virgin Mobile expects to keep growing and is anticipating opportunities as a result of the imminent lower interconnect environment. Integral to its growth plans are the introduction later this month of a new prepaid product at better than typical post-paid rates and the same flat tariff on its top-up and classic contract products.

"Our future plans are all about offering the best value to subscribers who call a lot every day. We aim to offer a great flat tariff to prepaid and post-paid users alike. And, in anticipation of the expected fairer peak interconnect environment, this tariff will incorporate the best peak rates in the market. We are also addressing customer service concerns as raised in a recent survey and this, together with our new tariffs, will assist us in taking Virgin Mobile’s growth to new levels," said Steve Bailey, Virgin Mobile’s CEO.

Virgin Mobile has spent the last 12 months streamlining its operations to deliver better rates, better deals, better customer service and an overall simpler proposition to consumers. The next 12 months will see the company rolling out these propositions via new marketing campaigns as well as a refreshed online and in-store presence.