Telstra on Thursday reported a strong set of full-year financial results driven by solid net customer additions across its fixed and mobile operations.
The Australian incumbent added 664,000 retail mobile customers in the 12 months to 30 June, leaving it with 16.7 million in total. Its retail fixed broadband base increased by 189,000 to almost 4 million.
Telstra’s mobile revenue increased by 10.2% to A$10.7 billion (€7 billion), while fixed revenue fell 1.9% to A$6.9 billion, as broadband growth failed to offset the continued decline in the company’s legacy fixed operations.
"We expect Telstra to maintain its leadership in the mobile market over the next 12-18 months, given its extensive network footprint and coverage," said Ian Chitterer, vice president and senior analyst at Moody’s, in a research note.
The coverage and capacity of Telstra’s mobile network should further improve over the next two years, after the operator allocated an extra A$500 million (€330.2 million) to mobile capex in July, bringing total investment up to A$5 billion in the three years to June 2017.
"We are committed to providing our customers with the best mobile coverage and reliability, with fewer dropouts and faster downloads in more places," said Telstra CEO Andrew Penn, in a statement.
The strong customer additions helped to drive Telstra’s full-year group revenue to A$26.6 billion (€17.6 billion), a modest increas e from A$26.3 billion a year earlier.
EBITDA fell 3.5% year-on-year to A$10.7 billion, while net profit slipped 0.9% to A$4.3 billion, due to the absence of Telstra’s CSL, which it sold to PCCW in 2014.
"Telstra’s EBITDA, excluding the impact from the sale of its Hong Kong-based CSL mobile phone network in May 2014, was up 4.5% year-on-year, reflecting the continued strong momentum and sound performance of the company", said Chitterer.
The strong performance prompted Telstra to increase its full-year dividend to 30.5 cents per share, thereby distributing A$3.7 billion to shareholders.
Looking ahead to 2016, Telstra expects free cash flow of between A$4.6 billion and A$5.1 billion, compared to $2.6 billion in full year 2015.
