CPW Europe had a difficult quarter, with volumes falling 9% and like-for-like revenue 2%, due to continued prepay weakness and the shift to 24 month contracts in the UK

The US business was again very strong, growing volumes at 26%, and this strength is likely to continue due to an acceleration in store roll outs

Keeping the European business flat in 2011/12 will be a challenge, but the US business is likely to more than make up for this at the group level

Growth in advertising for TV and the largest popular newspapers has not spread to local media, with regional press suffering declines in recruitment, auto and retail in 2010 despite colossal falls the previous year

Operating profit recovery in 2010 demonstrates firm management cost control, although the largest businesses have suffered 20% decline in annual profits since 2006

Publishers have engaged in various brand extensions, yet digital and other revenues remain stubbornly low, suggesting the scale of opportunity is destined to be a fraction of that from the sector’s recent past – and that consolidation is an industry inevitability

H3G Europe improved its revenue growth and margins in 2010, albeit not by as much as its headline figures claimed. It is currently growing at 5% with EBIT at around breakeven

Given that its parent company is likely to want to keep EBIT positive, it is likely to be constrained on future investment in subscriber growth, limiting its potential going forward

The UK was particularly strong, with dramatically improved contract subscriber growth, and margins improving despite this, driven by the completion of the T-Mobile network share implementation helping margins and the smartphone revolution playing to the company’s 3G network strengths

CPW’s European volume and revenue growth dropped in the December quarter, but this was largely due to the higher mix of prepay in the Christmas period, with underlying trends (strong contract, weak prepay) unchanged

US volume growth surged to 34% as the company continued to roll out standalone stores in malls and shopping centres, and there appears to be plenty of growth to come

Looking forward, the UK business is likely to suffer from the longer handset contracts that have been rolled out by the UK mobile operators over the last two years, but continued strength in the US is likely to more than make up for this