Chorus reports fall in full-year net profit

27 Aug 2019

New Zealand-based wholesale fixed line provider Chorus has announced its financial results for the twelve months ended 30 June 2019, reporting EBITDA of NZD636 million (USD405.9 million), in line with guidance but lower than the NZD653 million posted a year earlier. Operating revenue was slightly lower at NZD970 million, down from NZD990 million due mainly to the decline in legacy voice services, while net profit fell to NZD53 million from NZD85 million as a result of reduced revenue and higher borrowing costs to fund the Ultra Fast Broadband (UFB) rollout.

Chorus CEO Kate McKenzie, who is to step down from her post at the end of 2019, highlighted that demand for fibre has reached record levels and that more than half of the company’s broadband connections are on fibre. ‘When Chorus signed up to the original UFB project with the Government in 2011 we had a target of 20% for fibre uptake by 2020. We’ve well and truly smashed that target,’ she added. Chorus noted its government-backed UFB project, which provides broadband speeds of up to 1Gbps, is now 80% complete and passes 1.108 million customer premises. The company ended the year with 610,000 fibre connections, up from 445,000 a year earlier, while total broadband connections rose by a net 9,000 to 1.196 million. The company’s fixed line base fell by 76,000 to 1.45 million.

Chorus also indicated it is already considering which parts of its copper network could be shut down as operations switch to fibre. The regulator is expected to develop a copper withdrawal code for the industry by mid-2020.

New Zealand, Chorus (New Zealand)