Telstra lowered its guidance for fiscal 2021 (ending 30 June) due to low-margin equipment making up a higher percentage of hardware sales, as mobile revenue and ARPU dropped in H1.
It predicted revenue of AUD22.6 billion ($17.5 billion) to AUD23.2 billion, down from a previous forecast ranging between AUD23.2 billion to AUD25.1 billion: in fiscal 2020, the figure was AUD26.1 billion.
The underlying EBITDA target was narrowed from between AUD6.5 billion and AUD7 billion to AUD6.6 billion to AUD6.9 billion. The estimated Covid-19 (coronavirus) impact was unchanged at about AUD400 million.
In a statement, CEO Andrew Penn said H1 results showed Telstra’s financial performance was at a turning point ahead of an anticipated return to growth in underlying EBITDA in fiscal 2022.
“After a decade of disruption following the creation of the NBN, and with its rollout now declared complete, we can clearly see the path to underlying growth ahead of us,” Penn stated.
Fiscal 2022 is expected to deliver mid- to high-single digit growth in underlying EBITDA, with a target of between AUD7.5 billion and AUD8.5 billion in fiscal 2023.
Penn said progress on its turnaround strategy, which is less than 18 months from completion, is on track but the company remains focused on the work still to be done.
He added more than 80 per cent of the milestones were delivered or are on track, noting “I am confident the many initiatives, particularly in simplifying the business and the digitisation programme, will further improve customer experience”.
Net profit in fiscal H1 2021 fell 3.6 per cent year-on-year to AUD1.1 billion and operating revenue dropped 9.7 per cent to AUD10.98 billion.
Mobile revenue fell 12 per cent AUD4.71 billion, due to lower handset and international roaming sales.
Its mobile subscriber base increased 2.9 per cent to 19 million. Post-paid ARPU declined 8.6 per cent to AUD45.99.
Enterprise revenue fell 7.2 per cent to AUD563 million and fixed-line was down 7.5 per cent to AUD2.43 billion.
Capex guidance for the full fiscal year remains unchanged at AUD2.8 billion to AUD3.2 billion: it was AUD3.2 billion in the prior year.
Telstra also announced it would restart job cuts put on hold in March 2020 due to the pandemic. Its next wave of proposed organisational changes, which are subject to appropriate consultations, aims to reduce its direct workforce by 8,000 by the end of the calendar year.Subscribe to our daily newsletter Back