Spark New Zealand raised its capex guidance for fiscal 2023 (ending 30 June) after an extraordinary gain from the sale of a majority stake in its tower unit fuelled revenue and profit growth in H1.

CEO Jolie Hodson stated the growth in mobile was contrasted by challenging broadband and cloud markets. She added Spark had been navigating uncertain and inflationary economic conditions, like all businesses in the country.

It upped full-year capex guidance by 27 per cent to NZD520 million ($323.7 million).

Net profit grew from NZD179 million in fiscal H1 2022 to NZD837 million, with operating revenue up 34.1 per cent to NZD2.5 billion. Spark stated both figures were impacted by one-off gains from a divestment of its passive mobile infrastructure unit.

The TowerCo sale resulted in a net revenue gain of NZD584 million.

Mobile service revenue increased 8.8 per cent to NZD480 million, driven by higher ARPU, and growth in roaming and data usage.

IoT connections grew 39 per cent to 1.2 million.

Broadband sales fell 3.4 per cent to NZD313 million as ongoing price competition and rising access prices squeezed margins, Spark said.

Cloud, security, and service management revenue dropped 4.5 per cent to NZD214 million, as a shift towards public cloud resulted in repricing of private offerings and impacted margins.

Capex increased 14.7 per cent to NZD250 million, but as a percentage of operating revenue fell to 9.9 per cent from 11.5 per cent.

Mobile network spending dropped 6.8 per cent to NZD69 million.