TelstraClear earnings up 18% ahead of sale to Vodafone

BUSINESSDESK: TelstraClear, the New Zealand phone company Telstra has agreed to sell to Vodafone, lifted full-year earnings by 18% before an impairment charge on the business.

Earnings before interest, tax, depreciation and amortisation climbed to $A99 million in the 12 months ended June 30, from $84 million a year earlier, according to Telstra’s annual results, released to the ASX today. Sales fell 2.3% to $A502 million.

Vodafone last month agreed to buy TelstraClear for $840 million, giving the British company a stronger base from which to challenge Telecom. Telstra has taken a $A130 million impairment charge against goodwill for TelstraClear prior to the sale, it confirmed today.

Sydney-based Telstra today posted a 5.4% gain in net profit to $A3.4 billion as sales edged up 1% to $A25.2 billion. It was the second consecutive year of revenue growth after sales tumbled 2.3% in 2010.

Chief executive David Thodey forecast growth in sales and earnings would continue in 2013 at a “low single digit” pace, with the dividend expected to be unchanged from 2012 at 28 cents a share.

Shares of Telstra last traded at $A3.97 on the ASX and have gained 22% this year. The stock is rated a "hold" based on a Reuters poll of 18 analysts, with a price target of $A3.63.

Telstra’s results showed a continuation of the trend of growing mobile sales and shrinking revenue from fixed-line services. Fixed revenue fell 6.1% to $A7.49 billion and mobile gained 8.5% to $A8.67 billion.

Telstra’s fixed-line copper wires are being handed over to state-owned NBN Co as part of plans to roll out a national broadband network in Australia, in return for some $A11 billion.

Telstra’s sale of TelstraClear is subject to regulatory approvals.


1 · Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

1 Comment & Question

Commenter icon key: Subscriber Verified

Game over Telecom. Will someone turn out the lights as they leave Xtra?

Reply
Share
  • 0
  • 0

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.6584 -0.0016 -0.24%
AUD 0.9023 -0.0028 -0.31%
EUR 0.5993 -0.0041 -0.68%
GBP 0.4218 -0.0012 -0.28%
HKD 5.1100 -0.0061 -0.12%
JPY 81.6220 -0.2770 -0.34%

Commods

Commodity Price Change Time
Gold Index 1094.9 6.310 2015-07-31T00:
Oil Brent 52.2 -1.100 2015-07-31T00:
Oil Nymex 47.1 -1.410 2015-07-31T00:
Silver Index 14.8 0.060 2015-07-31T00:

Indices

Symbol Open High Last %
NZX 50 5891.9 5937.6 5891.9 0.49%
NASDAQ 5148.2 5155.0 5128.8 -0.01%
DAX 11271.3 11309.0 11257.1 0.46%
DJI 17755.9 17783.6 17746.0 -0.32%
FTSE 6668.9 6705.4 6668.9 0.41%
HKSE 24650.9 24661.2 24498.0 0.56%
NI225 20506.5 20585.2 20522.8 0.30%