VIRGIN Media today said it added cable customers at the fastest pace since being created from the merger of NTL and Telewest four years ago.

The telecoms and cable giant reported a far better than expected 38,300 net cable customers - those joining less those leaving - in the first three months of the year, up markedly on the 7,100 seen a year earlier.

Virgin also saw the number of mobile phone contract customers soar past the one million mark for the first time as it switched focus away from the pre-pay market.

The group, which is 4% owned by Virgin empire tycoon Sir Richard Branson, posted a 14.1% rise in underlying operating income during the first quarter, to £356 million.

Its performance follows the record result for net cable customer additions, which came as it attracted another 15% of customers year-on-year and saw disconnections fall to its lowest level in the merged group’s history.

This left churn - measuring the rate of customers joining and leaving the group - at 1.1%, maintained at the record low recorded a year earlier.

Neil Berkett, Virgin Media chief executive, said: "This quarter, we added cable customers at our fastest ever rate."

He added: "We are developing our services to exploit our natural network advantage, both now and in the future.

"More customers than ever before are choosing faster broadband and every day millions of our customers are enjoying the benefits of the video-on-demand revolution we are leading."

Its cable broadband offering continued to attract new subscribers, up 53% year-on-year at 72,300 on a net basis in the fourth quarter, helping take total broadband customers to 4.2 million.

Virgin announced in February it was to lead the way in super-fast broadband in Britain, with plans to roll-out the UK’s first 100Mb service by the end of 2011.

It already offers speeds of 20Mb to 50Mb nationwide, with the number of subscribers taking 50Mb up 40% in the quarter.

Telecoms analyst Steve Malcolm at Evolution Securities said today’s figures were "proof that after 26 years, it is finally leveraging cable’s hitherto theoretical network advantage".

A focus on improving customer service in recent years has also helped the group hold on to more customers, with Virgin Media claiming to have brought faults down to a record low following major investment.

Virgin has likewise been seeking to get customers using more than one service, with 62% taking three and 11% taking four.

The group’s overall revenues rose 2.9% in the three months to £963 million, led by the cable customer growth.

Virgin Media was formed in March 2006 through the merger of the UK’s then two largest cable companies NTL and Telewest and the subsequent takeover of Virgin Mobile in July 2006.

The group is now listed in New York and London after making a secondary listing on the London Stock Exchange in January.