iiNet are on the up – announcing a 17% rise in profits in a hectic six months for the telco.

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This major growth comes in the wake of iiNet’s recent acquisition of rival Internode for $103 million as well as TransACT.

Pre-tax earnings also grew 36% to $56.4m, with net profit (after tax) up an impressive 17% to $14.4m for H1 FY12.

Not bad for the company that started in a garage.

The Perth based telco now is No.2 in DSL broadband and has 860,000 customers using 1.7m of its services – “a record” figure, CEO Michael Malone revealed today, announcing the results for the six months ended 31 December.

This has pushed iiNet share of broadband DSL to 16% and comes in the wake of recent expansion in both Darwin and regional QLD.

The Company continued to grow across all key financials and enjoyed growing dividends, Malone added.

iiNet balance sheet is also in good shape with gearing “comfortable” at 73%, net debt to equity and revenues up 11% to $365m.

There was also a record low level of churn among customers.

“The last six months have been a period of considerable expansion, with iiNet continuing to grow scale and cementing its position as the clear number two in DSL broadband,” Malone said.

“We have laid the foundations for an exciting future. iiNet’s excellent financial performance over the past six months and attractive growth outlook clearly shows we are successfully executing the right strategy in light of the changing industry dynamics.”

The recent acquisitions of TransACT and Internode have been key in building further scale and to expanding iiNet’s national footprint and penetrate lucrative SME, corporate and government sectors, now a key strategic focus.

“In addition to having leading residential broadband market share in the ACT, TransACT provided a unique opportunity for iiNet to acquire significant network infrastructure assets in a key market,” he added.

Malone’s company is also on the ball to ensure it is ready to “capture the opportunities” the $36bn NBN will provide.

“iiNet is NBN ready. We have the scale, network capabilities, hardware capabilities, attractive pricing, and a brand centered on service and product delivery, that will allow us to thrive in an NBN world.”

And he said recent changes to the regulatory environment with the ACCC declaring new wholesale ADSL prices will provide a more level playing field in the transition to the NBN.

These changes will allow iiNet to be more competitive and grow its market share.

And iiNet is also looking to flog more products like phone, broadband and BoB packages, as well as IPTV service FetchTV to customers:

“Our goal is to increase the average number of products per customer from two to three by the end of the 2014 financial year. With 860,000 customers that use 1.7 million services, there is a substantial opportunity to further grow our business from its existing base.

Interim dividend up 20% to 6 cents per share fully franked.

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