Eircom made a pre-tax loss of €104 million in the year to the end of March 2002 compared to a pre-tax profit of €66 million in the previous year, it said yesterday.
Revenues during the year slumped €1.78 billion, following the sale of Eircell, down from €2.15 billion in the previous year.
But revenues at the firm's continuing core fixed-line operations grew by 6 per cent year-on-year when these are stripped out from the rest of the firm's divisions.
The losses, which were contained within Eircom's latest financial accounts, were boosted by a number of exceptional items such as the demerger of Eircell, the exit from a number of multimedia businesses and the write down on the value of its property portfolio.
Exceptional costs of €214 million recorded during 2002, include takeover costs of €45 million recorded following the firm's sale to the Valentia consortium.
About €15 million was paid to Mr Denis O'Brien's vehicle eIsland as compensation for not winning the battle for Eircom against the Valentia consortia, which consists of a group of US venture capitalists chaired by Sir Anthony O'Reilly.
Eircom also took a €48 million write down on the value of certain "onerous contracts" that the firm does not believe will ever turn a profit.
These include its sponsorship support for Media Lab Europe, certain Government contracts and its ongoing deal with Global Crossing, which provides Eircom with international telecoms capacity that it is trying to resell to other firms.
In the year to March 31st, 2002, Eircom made an operating loss of €47 million on its continuing activities, compared to an operating profit of €77 million in the previous 12-month period.
This loss - which was previously detailed in the Eircom's regulatory accounts - reflected pay inflation in the Republic, said Eircom's new chief executive, Dr Philip Nolan, who outlined that pay costs fell by just 3 per cent during the year to March 2002 while more than 1,000 staff had left the company.
Eircom paid out €49 million in redundancy charges in the year to the end of March 2002 as part of its continuing restructuring programme.
This programme has been under way since March and the current number of employees is 9,045, down from 10,950. The accounts show this programme is expected to be completed by March 2004.
The decision to exit almost all its international and multimedia businesses cost the firm €29 million in redundancy and other costs during the year. Loans worth €18.3 million and €19.1 million, to Eircom UK and Eircom Northern Ireland respectively, were written off during the year.
Stripping out the results for the discontinued parts of Eircom and the mobile business sold to Vodafone, Eircom posted a 6 per cent increase in turnover. In the year to the end of March 2002, Eircom's fixed-line operation generated revenue worth €1.645 billion, up from €1.540 billion in the previous 12 month period. Dr Nolan said this reflected the results of other fixed-line telecoms operators across Europe.
The accounts show Eircom's former chief executive, Mr Alfie Kane, received a pay-off worth €3.8 million after he left the firm at the end of December 2001. Twelve other directors of Eircom shared €1.1 million in payments.
