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Key performance indicators for the quarter ended 30 September 2007:

Total revenue (in local currency)¹:

• O2 UK total revenue grew by 9.7%;
• O2 Germany (including Telefónica Deutschland) total revenue fell by 1.8%;
• O2 Ireland total revenue grew by 4.3%;
• O2 Czech Republic group² total revenue grew by 3.4%

¹ Comparative period is 3 months to 30 September 2006.
² Telefónica O2 Czech Republic group consists of Telefónica O2 Czech Republic and Telefónica O2 Slovakia

Mobile average revenue per user (monthly, in local currency):

• O2 UK blended ARPU £24.3 (Q2 2007: £23.4; Q3 2006: £23.1)
• O2 Germany blended ARPU €20.8 (Q2 2007: €20.9; Q3 2006: €25.3)
• O2 Ireland blended ARPU €47.0 (Q2 2007: €46.7; Q3 2006: €45.2)
• O2 Czech Republic ARPU CZK 535  (Q2 2007: CZK 524; Q3 2006: CZK 519)

Mobile data in the third quarter

• Group SMS volumes grew by 12% year on year to 7.27 billion messages
• Group non-SMS data revenues now over €330 million for the year to date, +23% year on year

Peter Erskine, Chairman & Chief Executive of Telefónica O2 Europe, commented:
“O2 has delivered another robust set of results this quarter, adding 840,000 mobile customers in the third quarter, taking the total mobile customer base to 37.24 million, 8.3% higher than last year.

In the UK, like for like revenue growth of 10.2% in the first 9 months of the year is well above the market average and at the top end of our guidance range. The UK added 115,000 net customers, including 159,000 on contract, helped by migrations from prepay. Blended monthly ARPU growth of over £1 year on year illustrates that we are successfully focusing on higher value customers, while OIBDA margin of 27.3% improved from the previous quarter.

In Germany, customer growth in our mobile business accelerated in the third quarter, reflecting the initial impact of our new growth initiatives. 610,000 net mobile customers were added in the quarter, over twice the figure for the third quarter last year, taking the total base to 12.168 million, representing 14.5% year on year growth. The market continues to be challenging, with blended monthly ARPU down 17.8% year on year, but broadly stable quarter on quarter at €20.8. Our Telefónica Deutschland DSL business continues to perform well, with equivalent lines in service reaching over 813,000 at the end of September, an increase of 77% year on year, and remains on target to reach OIBDA breakeven on a monthly basis before the end of the year. We recently re-launched our O2 DSL service and are pleased with the growth in orders over the past weeks, reaching an average of 4,000 – 4,500 per week in September, which has yet to be reflected in our net additions number.

In the Czech Republic the business has built on its strong first half, delivering 3.4% group revenue growth in the third quarter, with again over 6% growth in the mobile business and broadly flat revenues in the fixed business, continuing the trends seen in the first half. The mobile business in Czech Republic added 74,000 net customers in the quarter, with 84,000 on contract, raising the percentage of contract customers in the base to 43.5%, compared to only 37.4% at the end of September 2006. In our fixed line business, the total number of ADSL lines stood at 545,000 at the end of September, compared to 427,000 at the same time last year.

In a competitive market O2 Ireland traded well, adding 21,000 net contract customers in the quarter, an increase of 28% compared to the same period last year, ending the period with a total customer base of 1.632 million, 2% higher than at the same time last year. The launch of O2 Broadband, our wireless mobile broadband solution, continues to exceeded our expectations, offering a real alternative to fixed broadband in the home in a market that is under penetrated and has good growth potential.

Guidance for the Telefónica O2 Europe group for the full year remains unchanged from last quarter.”

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