Optus cracks AU$9 billion in operating revenue as profits drop for fiscal year
Optus has completed its full fiscal year to 31 March and collected AU$9.1 billion in operating revenue, which represents a 5.7% increase year-on-year.
But a 7.6% increase in operating expenses to AU$6.5 billion saw the earnings reported by Optus decrease up by to 16%.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) for the full year dropped by 1% to AU$2.7 billion, underlying net profit fell by 8% to AU$716 million, and net profit shrunk by 16% to AU$659 million.
In line with its third quarter results, Optus pinned the drop on the National Broadband Network.
“Net profit was lower due mainly to the impact of the temporary suspension of NBN HFC migrations together with higher depreciation and amortisation costs and exceptional items as Optus continues to transform its business,” the company said.
For its fixed broadband products, the number of customers on its network was steady on 1.2 million customers, as users shifted form its HFC and ADSL products across to NBN products.
In mobile, revenue increased for the full year to just shy of AU$6 billion, a 10% jump, as its number of mobile subscribers increased by 1.7% to 10.3 million. With that number, Optus now has 6.7 million 4G customers, representing a 6% spike.
At the same time, the average revenue per user (ARPU) per month decreased across the three categories Optus reports. Prepaid ARPU shrank by 8.4% to AU$19, postpaid was down 5% to AU$42, and mobile broadband decreased by 2% to AU$21 per month.
Across its consumer revenue, Optus reported EBITDA increased 10%, however it would have been down 2% if not for NBN migration payments paid as customers shift off its network.
The fourth quarter results were a much more cheery reading as the telco reported operating revenue up 7.2% to AU$2.3 billion, EBITDA jumping 6%, and net profit growing by 11% to AU$228 million
“Optus achieved a very strong performance in the fourth quarter underpinned by a relentless focus on delivering exceptional network and customer value to drive customer growth and engagement,” Chief Executive Allen Lew said.
“Optus is scaling its 5G network in preparation for a broader commercial launch later this year which will start to see this exciting next generation technology in the homes and hands of our customers.”
During the year, Optus began rolling out its 5G Home Broadband product, which provides unlimited data at a 50Mbps minimum speed for AU$70 a month.
The telco has been using a mixture of Nokia and Ericsson kit for the build, and plans to have 1,200 5G mobile sites live by March 2020 across New South Wales, Victoria, Queensland, the Australian Capital Territory, South Australia, and Western Australia.
Optus’ Singaporean parent, Singtel, also reported full year results on Wednesday, with Singtel Group seeing operating revenue increase by 1% to SG$17.4 billion, however EBITDA dropped 7% to SG$4.7 billion, and net profit was down 44% to SG$3 billion.
Leading the way down as revenue was Singtel’s associate telcos, which saw earnings collapse by 37% to SG$1.5 billion from SG$2.5 billion a year prior.
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