Australian operator Telstra forecast factors which resulted in declines to profit and revenue in fiscal 2020 (the year to end-June) would continue to be headwinds in the current year.
In a statement, CEO Andy Penn (pictured) said for all of its progress in the previous year, the enormous disruption caused by the Covid-19 (coronavirus) pandemic made fiscal 2020 “an extraordinarily challenging year and one that highlighted the importance of connectivity”.
“Forced isolation and social distancing measures during the pandemic drove a huge acceleration in digitisation including in activities like telehealth, online learning, remote working and e-commerce.”
Its fiscal 2021 guidance predicts total revenue to decline by 3.8 per cent to 11.1 per cent year-on-year, with EBITDA about AUD400 million ($286.6 million) lower and capex to remain unchanged or decline 12.5 per cent to AUD2.8 billion.
“We have invested, and will continue to invest, for long-term returns and opportunities, especially in mobile and our T22 strategy, the benefits of which will be realised over time,” Penn said.
Fiscal 2020 net profit was down 14.4 per cent year-on-year to AUD1.8 billion, while revenue declined 6.1 per cent to AUD23.7 billion.
The company took an AUD830 million hit to earnings related to the country’s National Broadband Network (NBN), up from AUD600 million in fiscal 2019, and AUD1.5 billion in one-off NBN charges.
Penn said Telstra was 75 per cent of the way through the recurring financial impact from the government project. It is on track to achieve its AUD2.5 billion net cost reduction target in fiscal 2022, he said.
Planned job cuts among permanent staff were pushed back until February 2021. In March the company put the reductions on hold for six months.
“As we approach the end of that pause, it is clear that the impacts of Covid-19 will be with us for some time.”
Mobile turnover fell 4.4 per cent to AUD10.5 billion on declines in ARPU, roaming revenue and handsets sales.
Post-paid ARPU dropped 8.6 per cent to AUD50.29; prepaid was 6.3 per cent lower at AUD19.46.
Post-paid subscribers increased 2.9 per cent to 8.48 million, prepaid fell 12.9 per cent to 3.16 million and IoT connections grew 20.8 per cent to 3.78 million.Subscribe to our daily newsletter Back