Eircom shareholders have not been given financial results for the year to the end of March or details of expected exceptional costs and asset write-downs in the document setting out the proposed sale of Eircell to Vodafone.

Shareholders are being asked to vote on the demerger of Eircell from Eircom at an extraordinary general meeting on May 11th. But the preliminary results for the year to the end of March will not be announced until May 31st. The most up to date financial results provided for Eircom and Eircell in the documentation sent to shareholders were for the six months to the end of September 2000 - the already published interim results. These results do not show the operating performance of the businesses in the months from September.

In addition, in recent weeks Eircom has warned that, because of difficult market conditions for multimedia companies and its revised international strategy, it was reviewing the valuation of certain assets and investments which would result in exceptional asset impairments and writedowns. Eircom said it could not release figures for the year to end-March because these were not yet audited and the Irish Stock Exchange would not allow the release of unaudited figures. The stock exchange confirmed that it would not normally allow the release of unaudited results figures to shareholders but declined to comment in any specific case. Eircom said it had done everything it could to provide as much information as possible within stock exchange rules. "Clearly we had to operate within these rules and, in that context, we provided as much information as possible," the Eircom spokesman said.

Asked why the e.g.m. could not have been held after the full results had been published, he pointed out that the meeting was originally planned for March but was deferred because of the complexity of the deal.

Eircom has provided a current trading and profit estimate, which states that turnover for the year to March 31st, 2001 will be €2.1 billion (€1.7 billion excluding Eircell), a rise of 6.7 per cent on March 2000. Earnings before interest, tax, depreciation and amortisation were estimated at €640 million (€445 million excluding Eircell). But the profit figures are before any exceptional costs, asset impairments and writedowns. The documentation sets out performance data on Eircell. It shows that net cash inflow from operating activities rose from €34.8 million for the six months to end-September 1999 to €111.7 million for the six months to end-September 2000. Turnover rose to €322.3 million from €218 million over the period, while the average number of customers increased to 1,142,500 from 712,000. Average monthly turnover per customer fell to €44,000 from €50,000.

The Eircom board is recommending that shareholders approve the demerger and the sale of Eircell to Vodafone.

But in the documents sent to shareholders Eircom sets out the risks involved in the deal. These include:

the demerger could go ahead and the Vodafone deal could fail. This would mean that shareholders would be left with unlisted Eircell 2000 shares - they are to get one Eircell 2000 share for every Eircom share they own under the demerger proposals;

after the demerger Eircell 2000 could decide to terminate services, which Eircell has until now bought from Eircom. This could have a significant adverse impact on Eircom revenue and profits;

the demerger could lead to operating difficulties and/or additional costs for Eircom and/or Eircell;

after the demerger disputes and competition could arise between the separate Eircom and Eircell companies;

opportunities available to Eircom may be more limited after the demerger - under the terms of the deal Eircom will be restricted for three years from providing mobile telephone services in the Irish market;

Eircom may not be able to successfully implement its "refocus" strategy following the demerger.