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Telstra profit shrinks while Optus gains

12 Aug 2010
00:00
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Australian incumbent Telstra has reported declining earnings in FY10, while its closest competitor Optus saw strong gains.

Telstra's net profit shrank by 4.7% to A$3.88 billion ($3.48b), during what CEO David Thodey called “a challenging year.”

Revenue shrank 2.2% to A$24.8 billion, while ebitda declined 0.9% to A$6.5 billion.

Adjusting for the recent A$170 million writedown on Hong Kong unit CSL, as well as currency fluctuations and other factors, ebitda would have grown by 1.3%.

While mobile sales increased 5.9%, PSTN take-in declined by 8% or over $500 million. Revenue at CSL slumped 22.1% to $219 million.

Subscriber figures told a similar story, with the company adding 447,000 new postpaid mobile customers and 76,000 mobile broadband users, but losing 326,000 fixed retail lines and 19,000 fixed broadband customers.

Telstra had 7 million postpaid mobile subscribers and 3.5 million prepaid mobile customers by the end of the year. Blended mobile ARPU grew just 0.1% to $50.61.

 

The company is forecasting a high single digit percentage decline in ebitda and “flattish” revenue for the current financial year.

 

Optus, the Australian unit of SingTel, by comparison lifted its net profit 22% to A$170 million.

 

SingTel said its wholly-owned subsidiary lifted its ebitda 10%, and revenue 3%, thanks to strong mobile gains. Margins had also improved.

 

Optus CEO Paul O'Sullivan said the company saw its “strongest quarterly ebitda growth in five years.”

 

Mobile service revenue grew 11%, while its wireless subscriber base grew by 190,000 to 8.69 million. Blended ARPU grew 3% to A$47.

 

The company also lifted consumer fixed-line revenue 5%, and on-net broadband customers by 7%. Its business division saw similar healthy growth.

MORE ARTICLES ON AUSTRALIA, EARNINGS, OPTUS, TELSTRA

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