The State's third mobile operator Meteor cut its losses to €26.5 million last year as it added subscribers and boosted turnover.

Turnover increased to €59.8 million in 2003, up from €45.5 million a year earlier as the company claimed 5 per cent of the market from its rivals Vodafone and O2.

The latest financial accounts for Meteor, which is a potential takeover target for Eircom, show that its accumulated losses have reached €140.3 million since the company first launched in 2001.

Its auditors, PricewaterhouseCoopers, draw attention to the scale of Meteors losses. However, it notes that its parent Western Wireless has confirmed it will continue to finance the company.

Eircom recently confirmed that it would consider buying Meteor as a way to re-enter the mobile phone market. Meteor's 2003 results will offer it a valuable insight into the price that it would have to pay to Western Wireless to secure the company.

Meteor cut its operating loss to €17.95 million in 2003, down from €24.8 million a year earlier.

Interest payments worth €8.6 million pushed up its pre-tax loss to €26.5 million last year, compared to €32.1 million a year earlier.

The huge losses generated by Meteor since its entry into the Irish mobile market mean that the firm has a potential deferred tax asset worth €17.3 million.

The firm says this asset may be used in the future to write off taxes against any future profits generated by the firm.

Better cost control as well as higher turnover contribute to the improved financial results at Meteor, which only recently filed its 2003 results with the Irish Companies Registration office.

Capital expenditure fell to €8.97 million last year, from €10.8 million in 2002.

The results show Meteor Mobile Communications had shareholder funds worth €6.5 million at December 31st 2003, down from €32.9 million a year earlier.