Thanks 4G: Telstra +600K Mobile Users, Predicts “Slowdown”

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We’re up: The mobile market may be “slowing” but Telstra added over half a million new users in six months
Telstra’s half year 2012 revenues, profits and customers all soared as its reinvention continues to pay dividends. 

Net Profit NPAT for the six months to December 31 rose almost 9% to $1,6 billion, while earnings (EBITDA) were also up 5% to $4,9bn, on the back of massive growth in mobile.

Telstra’s mobile division was its star player adding 607,000 new customers – it now has a whopping 14.4 million mobile users on its Next G and 4G networks (6.9 m postpaid and 3.3 m mobile broadband), although admitted today it is a “slowing market.”

It added 265,000 postpaid handheld users alone in six months.

Almost one quarter of a million (244K) also joined its 4G LTE network, the biggest in Oz.

Overall, mobile revenue grew by 4.6% to $4,5bn.

It has a total of 1.5 million using 4G mobile services since launch in September 2011 – rise of almost half a million from when it last confirmed its user numbers.

13% of all smartphone users (postpaid) are on 4G LTE and 17% are mobile broadband users.

“These results show we are delivering on our commitments,” said CEO David Thodey.

“We continue to see customer growth in key products and services, particularly mobiles. This is testament to our focus on improving customer service and maintaining network leadership.”

There was also a 10% drop in the number of complaints to the telco ombudsman, although Thodey said there was room for improvement.

Telstra attributed to “new postpaid offers and an expanded 4G handset and tablet range” to its success on 4G selling 12 handsets and 4 tablets on the LTE network.

However, average revenue per user for a postpaid mobile user fell 7.1% to $58.88, blamed on the growth of customers using mobile repayment options.

Beyond the domestic market, it now has almost 4 million mobile customers in Hong Kong

Online sales volumes rose 62% and an additional 125,000 Livechat sessions on its site.

Mobile is also proving more popular than fixed line, adding 218K mobile broadband users during the six months, and 85K on  fixed broadband.

Telstra has 1.5 m customers on bundles – 117,000 new users bought into their ‘bundled’ plans from July- December last.

However, 151,000 cancelled their fixed line home phone bringing the number using fixed line phone services to 7.9 m and revenue dropped 11%.

Fixed line revenue fell 4% to $3,663 million as growth in the fixed broadband was not enough to offset the decline in phone lines.

Telstra’s TV revenues also grew slightly by 1% to $333 million, driven primarily by IPTV Content BigPond Movies and Foxtel on T- Box.

However, Digital media revenue, which includes Sensis phone directory, declined by 7%.

Network Application and Services (NAS) revenue grew over 10% to $636 million, with several long term contracts signed during fiscal 2012, and it is a business Telstra is set to focus more on in the future.

 

It also pocketed $176 million in ‘recognised revenue ‘ from the NBN agreement, and says it “continued to support NBN Co and made good progress on the build of the transit network and commenced selling NBN retail and wholesale services”

The company also confirmed guidance for fiscal 2013, predicting “low single digit growth” with a rise in earnings of 8.7% and total incomes to jump 2.6%.

“We are very committed to putting the customer at thecentre of everything we do. We are continuing to make improvements, whether enhancing our digital and online service capability, refreshing mobile plans or cutting transaction times in our retail stores,” Thodey said today.

Telstra invested $1.9 billion in capital expenditure during the six months, including its mobile network, and is planning a massive extension of its 4G network this year, to cover 66% of the population (up form 40%). The telco had free cashflow for the half of $2,155 million included cash proceeds from the sale of TelstraClear.

Telstra has confirmed a fully franked interim dividend of 14 cents per share.

Telstra says it intends to maintain a 28 cent fully franked dividend per share for fiscal 2013.

Shares fell 0.11% to $4.57 after the announcement.

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