Progress on the trantasman submarine cable will leap ahead over the next six months, Kordia chairman David Clark announced today.

Mr Clark said the new cable would reduce New Zealand’s connectivity risk on international routes to Australia and further a field. The OptiKor cable is set to lower prices for New Zealand businesses and broadband users.

The new cable will mean more direct and improved services and will de-risk business access to Australia. “Kordia’s intention is to deliver the economic benefits of fast, competitively-priced international access to all New Zealanders,” Mr Clark said.

“Our proposed cable will take the most direct, quickest and least expensive route for New Zealand customers. OptiKor is a better proposition for New Zealand than any other cable project. We are the most direct route to Australia and through our partners, we can deliver New Zealand traffic all the way to the US,” he said.

Mr Clark said since Kordia announced its plans 18 months ago, Southern Cross had dropped its prices by 75%. He said the key objective was to award a contract in early next year for the installation of the cable.

Back in black
Meanwhile, Kordia reported $4.7 million net profit before restructuring costs for its second half. Kordia spent $2.2 million after tax on restructuring costs, which was substantially driven by redundancies in the New Zealand engineering consultancy businesses.  Kordia reported an overall net loss after tax of $1.1 million on revenues of $254 million.

It's a turn-around result for the heavily-geared, acquisition-hungry state-owned enterprise, which earlier this year entered technical breach of its banking covenants.

Kordia chief executive Geoff Hunt said the result was pleasing given the high levels of capital investment Kordia has made in the telecommunications and related sectors.

“Kordia Networks in New Zealand is re-engerised and focused on developing business in the corporate and ICT sector through a number of new offerings like OnKor  (Ethernet carrier) and KorKor ( an integrated, two-way, digital radio).

It’s first half of revenue come in at $114.2 million, slightly increasing to $138.4 million in the second half bringing the company’s total revenue for the year ending June 30 to $253.6 million. Ebitda was $15.1 million for the first half, increasing to $25.3 million in the second half.

Mr Hunt said Kordia is focused on improved customer service and leveraging its recent investments for a more profitable future. He said the new fibre-optic cable from Auckland to Sydney as a positive move for Kordia.

Yesterday, the government announced a $300 million rural broadband initiative as part of its $1.5 billion plans to deliver ultra-fast broadband to the majority of New Zealanders.