Australian operator TPG Telecom’s profit dropped sharply in the year to end-June, due to costly write downs stemming from abandoning the rollout of a mobile network in the country.
The operator suffered a 56 per cent year-on-year drop in net profit to AUD174 million ($118 million). It reported a spectrum impairment cost of AUD237 million. Total revenue was largely flat at AUD2.48 billion, down 0.7 per cent.
TPG Telecom restated its fiscal H1 2019 figures to reflect an AUD227 million impairment charge relating to a decision taken in January to abandon deployment of a domestic mobile network after Australia’s government banned Huawei, its principal equipment vendor.
The Australian Competition and Consumer Commission in May blocked a planned merger with Vodafone Hutchison Australia on the grounds it would likely substantially lessen competition in mobile services. The companies initiated legal proceedings against the decision, with a hearing scheduled for 10 September.
Stephen Banfield, TPG Telecom CFO, said it expects the financial impact of customers moving to the country’s National Broadband Network to peak in fiscal 2020 at about AUD85 million.
The operator launched a trial mobile service in Singapore earlier in 2019: by end-July it had signed up more than 300,000 subscribers and the network covered 99.7 per cent of the city state.
Its fiscal 2019 capex in Singapore totaled AUD80.1 million, up from AUD62.3 million in fiscal 2018.