Stuart Corner
Wednesday, 08 November 2006 10:33
IT Industry -
Deals
Page 1 of 2
Optus has described its second quarter result in which it reported a 2.3 percent revenue increase, 3.2 percent EBITDA reduction (excluding recent acquisitions) and a net profit decline of 12.11 percent as a "stabilising" of its competitive position and the impact of cost cutting initiatives as "crystallising".
Operating revenue grew 5.8 percent on the same quarter last year. However this included revenue from acquisitions Alphawest and Virgin Mobile. Without these growth was 2.3 percent. Operational EBITDA increased by 1.4 percent from the prior quarter but declined year on year by 3.2 percent mainly due to lower consumer fixed line earnings, the company said.
"For the first six months of our financial year, we have seen a 5.6 percent increase in operating revenue to $3.70 billion and recorded an underlying net profit of $239 million," CEO, Paul O'Sullivan said. However, net profit after tax for the second quarter was 12 percent down on the same quarter last year, to $130 million."
O'Sullivan said the company's results reflected Optus "showing our resilience in an intensely competitive market...To mitigate margin pressure, we continue to implement cost management and productivity initiatives across the company including lower commission rates, reduced headcount and call centre offshoring...The positive impact of these initiatives on EBITDA margins is now crystallising."
Operational EBITDA margin was at 26.0 percent, down from 28.4 percent a year ago as a result, Optus said, of higher uptake of mobile caps, decline in fixed line margins and the impact of acquisitions. The company claims to have "successfully defended its share of the mobile market" which increased to 33.3 percent. It did not say what its share was previously.
In the quarter, around 32 percent of new and recontracted customers chose capped plans, similar to recent quarters. Approximately 24 percent of the total Optus postpaid mobile base are now under capped plans, up from 10 percent a year ago."
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