Telstra earnings fall short of expectations despite a stellar year in mobile.
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Telstra’s full year results to June 30 show massive growth on the mobile front, while fixed line and Sensis decline continues.
Telstra’s total revenue rose 1.1% to $25.4bn – below guidance of 1.3%, while earnings (EBITDA) before interest and depreciations also fell short of expectations rising just 08% – compared to guidance of 2.1%.
Net profit after tax rose 5.4% to $3.4bn.
Its mobile business was the main driver of revenue growth rising 8.5% or $679 million to $8.7bn, with postpaid revenues up 6% to 4.7bn.
Australia’s biggest telco also sold 375,000 4G devices, making it by far the top 4G LTE carrier in OZ, since it the launched the first service last year.
The telco increased its Next G mobile customer base by 1.6m since the same time 2011, confirming the past 12 months was “another strong year for mobile.”
However, despite the growth, average revenue per user rose just 0.1%.
Mobile churn, which denotes the difference between those who joined and left the network was 12.2%.
Meanwhile, Telstra fixed line business slumped 6% or $484m to $7.5bn, as it revealed the number of household customers with mobiles-only soared from just 2% to 14%.
The decline in fixed line telephone was partially offset by rises in fixed broadband users, which swelled to 2.6m users – an addition of 203,000- while those with Telstra bundles also rose 336,000 to 1.4 million.
This decline in fixed was in line with expectations, the telco said.
On the IPTV front, 193,000 new T-boxes were bought in the past year as were 148,000 T-hubs.
Telstra also reported 5 million BigPond movie downloads and 2.3 million transactions across the BigPond portfolio which includes online, IPTV services and other content services.
Media revenues took a -9.6% dip overall, blamed on poor performance of Sensis directory and other digital media, although there was some growth recorded in yellow pages digital with traffic up 16%.
Telstra’s revenue from Foxtel, in which it has a 50% stake, rose 3.6% to $2.2bn and reported increased uptake of Pay TV services including Foxtel multi-room, Foxtel iQ and HD services.
Fox Sports customer penetration was also greater than 80% and premium platinum services also exceeded 40%.
Telstra’s Data and IP took a slight dip of 0.8% or $25m to $3.1bn due to a decline in legacy revenues, although the demand for IP access services for enterprise was up.
On the customer service front, Telstra reported a 26% drop in ‘level 1’ customer complaints to the telco ombudsman and cited new customer service apps (13) and Facebook LiveChat among its service initiatives, and pledged to continue to improve its image as a customer friendly carrier.
Telstra’s ‘Other’ revenues also received a major boost in the form of a payment of $67m from the government. The payment has to do with Telstra’s deal with the NBN and will total $11 bn over several years.
Excess cashflow at 30 June was $1bn and Telstra forecasts this rise to $2-$3bn in three years.
The telco also confirmed FY12 and FY 13 dividend of 28c fully franked and pledged to increase this over time.