Telstra Full-Year Profits Up 10 Percent

Australia's dominant telco, Telstra has reported that its full financial year revenues rose by 2.7 percent to AU$25.51 billion (US$21.1 billion). Excluding the impact of the sale of KAZ in April 2009, total revenue grew by 3 percent. Net profit rose by 10 percent to AU$4.1 billion (US$3.4 billion). The company generated free cash flow of AU$4.4 billion, a 13 percent increase on the prior year.

Telstra's Chief Executive Officer, David Thodey, said that "as we highlighted at our half year results in February, our business is not immune to the economic slowdown. We continue to experience reduced usage of both fixed-line and mobile voice usage, while there is evidence of slowing customer growth in fixed broadband take up."

"Against this backdrop, I am delighted that our results are in line with our previous guidance, with the 5.3 percent EBIT growth slightly above the expectations we outlined in February."

Telstra continues to see strong growth in key product areas, with 10 percent mobile services growth among more than one million wireless broadband customers and 25 percent growth in IP access revenue more than offsetting declines in traditional fixed-line voice revenues.

"Telstra's transformation has been a long, complex and necessary journey and while there is more work to be done on IT and some network exits, we regard this work as business as usual .We must now drive the benefits of the new systems and processes," Mr Thodey said. "We acknowledge not all customer experiences have met expectations but our team is focused on quickly improving the customer experience so it becomes an unequivocal point of differentiation for Telstra. That can only be good news for our shareholders as well."

Commenting on the year ahead, Mr Thodey noted: "Telstra faces significant challenges in the coming year, but we are well positioned to face those challenges. On the issue of the national broadband network (NBN), we are now engaging constructively with the Federal Government, as well as the new NBN Company. We are working to find the right way to deliver the objective of a world-class communications infrastructure for Australia, while protecting Telstra shareholders."

Posted to the site on 13th August 2009