Telecom reports rising profits despite falling revenues

6 Nov 2009

Incumbent operator Telecom New Zealand has reported net profit of NZD163 million (USD117.47 million) for the first quarter of the reporting year ended 30 September 2009, up 9.4% from NZD149 million a year earlier, despite revenues dropping by 6.5% year-on-year, to NZD1.36 billion. The company attributed the growth to a one-off effect from changes in tax law worth NZD43 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) fell by 4.1% from NZD466 million in the third quarter of 2008 to NZD447 million a year later. Company CEO Paul Reynolds said: ‘We have been successful in a market that has seen a significant rise in competition and customer choice. Telecom saw a net increase of 64,000 mobile customers during Q1, with 242,000 customers on [new 3G network] XT at the end of its first full quarter of operation. The rest of the year will see the deployment of mobile HSPA+ technology, which offers maximum mobile data speeds of up to 21Mbps. This confirms Telecom’s clear leadership in New Zealand and XT’s position as one of the fastest mobile networks in the world.’

New Zealand, Spark, Spark New Zealand Group