iiNet reported a 19 percent increase in revenue to $831m, a 47 percent increase in EBITDA to $144.8m; (underlying EBITDA up 38 percent to $144.2m, NPAT up 11 percent to $37.1m (underlying NPAT up 12 percent to $43.6m).
In anticipation of a good result, iiNet shares rose to a seven year high yesterday, closing at $3.52 (They hit a nadir of almost zero in 2006 as the company struggled with integration issues following its $100m acquistion of OzEmail).
iiNet CEO, Michael Malone, said: "These acquisitions, which we are currently integrating, cemented our position as the clear number two provider of DSL broadband in Australia. We also substantially grew our corporate and government business following the acquisition of TransACT."
The company said that the acquisitions of TransACT and Internode had taken its broadband market share to approximately 15 percent and boosted the number of customer services by 26 percent to 1.6 million, "due to increased bundling of new services."
The company expects to fully integrate Internode's and TransACT's systems and networks over the next 12-24 months.
Malone said: "We expect to generate substantial integration synergies as TransACT and Internode are fully integrated. We have a number of innovative new products to be launched that will assist in increasing our average products per customer, and our business segment is now structured for further growth." He said the company's goal was to increase the average number of products per customer to three products.
iiNet now has DSLAMs in 445 Telstra exchange but is also anticipating growth in its DSL offerings delivered by reselling services off Telstra DSLAMs.
Malone said: "The regulatory landscape has changed dramatically in the last 12 months making the regional off-net market more attractive for iiNet. The ACCC has declared new wholesale ADSL interim prices that provide an improvement in the iiNet cost base in regional markets. We look forward to the final determination being released soon so that iiNet can be more competitive and grow market share again in regional Australia...And we are well placed to grow as the NBN continues to be rolled out.
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