Christchurch-based fibre optic company Enable networks has recorded after tax profit growth of 235% compared to normalised profit in the previous year, it reported at its annual general meeting today.Enable, 100% owned by the investment arm of the Christc
Christchurch-based fibre optic company Enable networks has recorded after tax profit growth of 235% compared to normalised profit in the previous year, it reported at its annual general meeting today.
Enable, 100% owned by the investment arm of the Christchurch City Council, recorded net profit after tax of $448,000 for its financial year ending June 30.
Revenue fell to $2.9 million from the prior year’s $3.4 million.
Chief executive Steve Fuller told NBR that without a big one-off consultancy, “normalised” revenue for the previous year was $1.6 million.
Mr Fuller said demand for fibre had outweighed the effects of the recession.
Enable is aiming for its fibre network to pass 85% of Christchurch businesses by next year.
The chief executive said the current financial year had begun ahead of plan, but Enable was now facing short-term challenges brought on by the quake, and its dampening effect on business spending.
As with other fibre providers and telcos, the main influence on Enable’s 2011 financial year will be whether it is successful, or not, in winning the Crown fibre contract for Christchurch (it faces competition, at minimum, from Telecom, which has placed a national bid).
While it waits for the outcome of that big decision, it will to connect business customers as demand warrants, Mr Fuller said.
The education market is another focus.
“During the first half of 2010 we delivered ultra fast fibre to 35 Christchurch schools with a further 53 contracted to connect, creating the largest and faster growing schools’ network in New Zealand,” said Mr Fuller (Christchurch has around 300 schools in total).
Most of the schools are already within reach of Enable's 180km fibre network.
The company charges $195 a month for a 1Gbit/sec (1000Mbit/s) fibre link. A school pays ISP fees on top of that.
Mr Fuller said beyond the final rewards, the project was "an important investment in the future of our community."
Not on TelstraClear's Christmas card list
TelstraClear’s chief executive, Allan Freeth, has been less charitable, singling out the rate-payer backed Enable as an example of what he calls “network socialism” that inhibits private investment.
Nevertheless, TelstraClear is embarking on its own cable network upgrade in Christchurch (and Wellington).
Dr Freeth has said that if taxpayer funds must be spent on fibre, then they should be spent on Telecom's Chorus division.
Enable Networks’ innovation was recognised by Tuanz when Mr Fuller was named the 2010 ‘Innovator of the Year’ for the company’s innovation and success in developing the Christchurch schools network.
