Telstra Reveals Ambitious Fiscal 2024 Targets Amid Strong FY23 Performance

Telstra, Australia’s leading telecommunications provider, has unveiled its ambitious financial targets for the upcoming fiscal year, building upon a robust fiscal year 2023 performance.
Telstra broadbandThe company aims to achieve a total income ranging from $22.8 to $24.8 billion, EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) in the range of $8.2 to $8.4 billion, and Capital Expenditure (Capex) between $3.6 and $3.7 billion during fiscal year 2024.

Comparing these projections with the company’s fiscal year 2023 results, Telstra demonstrated commendable growth. In 2023, the company reported a revenue of $23.2 billion, marking a substantial 5.4 percent increase. EBITDA also experienced healthy growth, surging by 8.4 percent to reach $7.9 billion. Capex, reflecting the company’s investment in infrastructure, rose by an impressive 18.2 percent to $3.597 billion.

Telstra attributed its favorable financial performance in 2023 to various factors. Notably, the company’s total income, excluding finance income, grew by 5.4 percent to a total of $23.245 million. This increase was driven by higher mobile services and hardware income, coupled with elevated international income.

Among Telstra’s key business segments, Telstra Consumer and Small Business stood out with a 5.4 percent increase in income, reaching $12.619 million. This remarkable growth included a significant 9.5 percent surge in mobile income. The expansion of mobile services revenue was fueled by increases in Average Revenue Per User (ARPU) and Services In Operation (SIOs) across mobile products. Additionally, higher mobile hardware revenue resulted from increased sales volumes.

Telstra Enterprise, another crucial division, experienced an impressive 11.2 percent surge in income, reaching $7.929 million. This figure includes $719 million attributed to Digicel Pacific. Domestic mobile income within the Enterprise segment increased by 2.7 percent, driven by growth in Internet of Things (IoT) value-add applications.

Global Networks and Technology, a segment vital for Telstra’s technological advancement, witnessed an exceptional 37.7 percent increase in income, totaling $413 million. This growth was partly attributed to a $105 million internal income boost.

Telstra InfraCo, responsible for critical infrastructure, reported a 3.8 percent increase in income, reaching $3.775 million. This growth was largely attributed to the expansion of recurring nbn Definitive Agreement (DA) receipts.

In terms of capital expenditure (Capex), Telstra celebrated five years of 5G technology deployment. The company achieved its 5G population coverage target of 85 percent for FY23, with 41 percent of mobile traffic now utilizing 5G. The total mobile coverage at the end of FY23 expanded to 2.72 million square kilometers, reflecting an addition of 80,000 square kilometers over the past two years.

Telstra’s projected Capex for the upcoming fiscal year is set between $3.6 and $3.7 billion. This includes approximately $300 million for strategic investment in projects beyond business-as-usual (BAU) operations, such as the intercity fiber and Viasat infrastructure endeavors. Furthermore, around $150 million is allocated for the Digicel Pacific project, and a heightened commitment to infrastructure investment on an international scale.

Telstra’s digital leadership

Telstra said 88 percent of C&SB sales are on its new digital stack. For customers this means simplified billing, as well as faster average activation times for their services. For teams this means simpler processes freeing up more time to spend with the customer. In total, 43 percent of all C&SB services are on new platform and it is on track for all services to be on its new digital stack by FY25.

70 percent of new Consumer fixed broadband orders are now being placed in the new digital stack, significantly reducing order entry time and delivering strong eNPS results. Through the effects of this combined work, Telstra has achieved a 35 percent fall in Telecommunications Industry Ombudsman escalations.

Telstra informed that 33 percent of core processes have been improved by AI, reducing network energy consumption and solving customer issues faster. Telstra said 68 percent of service interactions are available digitally. Telstra has built 89 percent of targeted APIs for Adaptive Networks, using Open APIs to reduce cost and time to market.