TPG Telecom cites impact of global travel restrictions as revenue declines in 1H20

21 Aug 2020

Publishing its first set of financial results since the merger of Vodafone Hutchison Australia (VHA) and TPG Corporation, the newly-enlarged TPG Telecom Limited reported a total turnover of AUD1.540 billion (USD1.1 billion) for the six months ended 30 June 2020, down from AUD1.723 billion a year earlier, citing the ‘significant impact’ of global travel restrictions on both turnover and EBITDA. Of note, the company highlighted the fact that the figures it presented included just four day’s contribution from TPG Corporation, as the merger only became effective for accounting purposes on 26 June 2020. As such, it reported that underlying TPG Telecom (i.e. former VHA) standalone revenue totalled AUD1.513 billion for H1 2020.

TPG Telecom’s reported EBITDA for the six-month period stood at AUD531 million, down from AUD583 million a year earlier, including a AUD9 million contribution from TPG Corporation for the four days post-merger, and AUD24 million of merger transaction costs. Meanwhile, the company reported a net profit of AUD83 million for 1H20, which it said included a AUD226 million one-off, non-cash credit to tax expense. Excluding this and the effect of the merger transaction costs and TPG Corporation contribution, TPG Telecom recorded an underlying net loss of AUD117 million, a AUD27 million (19%) improvement relative to 1H19.

In terms of operational metrics, TPG Telecom reported a mobile subscriber base (for VHA) of 5.469 million as of 30 June 2020, down from 5.990 million a year earlier, with post-paid accesses accounting for 3.354 million of that figure (Jun-19: 3.445 million) and pre-paid accesses numbering 1.818 million (Jun-19: 2.196 million). The remaining 297,000 were those signed up via an MVNO provider, with the company noting that this figure included 242,000 signed up to the TPG-branded service. Vodafone Australia-branded fixed broadband accesses were, meanwhile, said to number 150,000 at mid-2020, up from around 70,000 a year earlier.

For TPG Corporation, fixed broadband accesses reportedly increased to 1.971 million by the end of the reporting period, up from 1.926 million at mid-2019, of which 1.588 million were National Broadband Network-based connections, up from 1.220 million. TPG Corporation mobile subscriber numbers (including those signed up to iiNet-branded plans) continued a downward trend, however, falling to 357,000 at 30 June 2020, from 410,000 at July 2019.