2degrees, whose television ads are fronted by Rhys Darby, argues that it has been instrumental in bringing down the price of calls, texts and data. Photo / Supplied
Mobile operator 2degrees says its finances are healthy despite a $77 million loss for last year.
According to documents released by the Companies Office yesterday, 2degrees grossed $107.6 million in revenue in the year to December 31, 2010, but still ended up in the red.
For the previous financial period
- the first nine months of its operation in 2009 - it lost $51.8 million on revenue of $27.3 million.
Despite the continued losses, corporate communications manager Matt Bolland remained positive the company was on track.
"The reality is that 2degrees has become a $100 million business in 18 months. If you ever wanted to see competition, now we're the example."
2degrees was launched in August 2009 and has argued that it has been instrumental in bringing down the price of calls, texts and data.
It announced in March it had 580,000 mobile connections - about 11 per cent of the market.
Bolland said the losses were the price of getting a foothold in a mature market.
"We're certainly on plan in terms of shareholders' expectations. You can't enter into a $2.4 billion revenue market without having to invest."
2degrees has invested $300 million in building its network and establishing retail stores and plans to invest a further $100 million before the end of next year.
Last month it was revealed that shareholders put another US$4.8 million into the business, bringing the total capital raised this year to US$24.3 million.
Bolland denied this was a result of 2degrees chewing through its funds and said it was always part of the plan.
"Our shareholders have done this many times before in other countries and they know you have to invest in the early stages to get up and running."
2degrees' majority shareholder is United States-based Trilogy International, with 58 per cent. Others include Hautaki Ltd, a Maori-owned company associated with Te Huarahi Tika Trust, which has 10.4 per cent.
