Orange still in the red

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The UK mobile phone provider Orange has moved closer to profitability, reducing its pre-tax loss by a third during the first six months of the year.
 
The company posted a pre-tax loss of £49.1m compared with £73.5m in the same period a year ago, and for the first time made an operating profit, albeit small at £2.2m.
 
This compares to an operating loss of £40m last year. 

To explain the result Orange points to record growth figures. 

The company added 249,000 new customers to its network, up 27% since last year to a total 1.5m.

 
Orange is the UK’s third biggest mobile phone operator and says that it now has a market share of 15%.
 
The expansion was helped by cheaper customer acquisition costs, mainly because the price of handsets have come down dramatically.
 
Managing director Hans Snook said the results showed “a significant acceleration in customer growth, good performance on our key business drivers and strong progress towards profitability.”
 
He said the company looked forward to continued growth in the second half and planned to penetrate the market further with the launch in the autumn of a new competitive price cutting venture.
 
Earlier this year, Mr Snook had predicted that mobile phone use in the UK would reach 50% of the population by 2004.
 
Mobile phone shares have recently been good performers on the London Stock Exchange and analysts expect Orange shares to rise on the latest news.