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iiNet lifts revenues, EBITDA and profit

iiNet has reported a good set of results for the year to 30 June 2010, with revenue, EBITDA and NPAT all up substantially on the previous year.

Revenue grew 13 percent to $473.8m, and subscriber services grew by 27 percent to 960,000. Underlying EBITDA was up 20 percent to $80.7m and underlying NPAT up 36 percent to $34.8m. Total broadband customers grew 28 percent to 539,000 following the acquisition of Netspace.

Naked DSL subscriber numbers grew 59 percent to 106,400. Revenues from the small business unit, which iiNet is striving to grow as a percentage of its overall business were up 18 percent to $36.5m but have been restated to include hosting and domain revenues.

iiNet acquired Netspace in April 2010, and announced the planned acquisition of AAPT's consumer division, to be completed in September 2010.

CEO Michael Malone said: "It is important to highlight that we have not just focused on top line growth. The rate of growth in iiNet's earnings has continued to surpass the rate of growth in revenues. We continued to deliver improved cost management and efficiency in our core activities and the full synergy target from the acquisition of Westnet."

He added: "One of our key targets has been to reach fifteen percent DSL market share prior to the full launch of the National Broadband Network. The acquisition of Netspace, and the proposed acquisition of AAPT's consumer division will bring iiNet very close to achieving this goal'¦


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"We anticipate achieving similar synergies [to those achieved from the earlier acquisition of Westnet] from our recent acquisition of Netspace and the acquisition of AAPT's consumer division in 2011 and beyond."

He said the integration of Westnet had been completed during the year and that significant synergies had been delivered earlier than forecast.

According to Malone, the integration of Netspace is "in full swing" and-on track for completion in FY11. He said iiNet had completed integration of HR, information systems and staff networks in under one month, that customer migrations were underway and network interconnectivity and other integration initiatives on track. The Netspace acquisition is expected to be EPS accretive from FY11.

Malone said the company's BoB all-in-one wireless home hub combining the phone and Internet and connecting to entertainment platforms like Xbox, had been an outstanding success, with more than 50,000 units installed since its launch in August 2009.

iiNet still has a long way to go to achieve in other major cities the level of brand awareness it enjoys in Perth. There unprompted awareness has been almost consistently above 60 percent and prompted close to 100 percent. Brisbane, Melbourne and Sydney are all running at 20-30 percent unprompted awareness and around 60 percent prompted.



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