Telecom NZ revenue down by 7.7 percent


By Telecom Lead Team:Telecom Corp. of New Zealand posted a revenue decline of
7.7 percent at NZ$2.36 billion for the period of six months ended Dec. 31,
while adjusted revenue was down 8.5% at NZ$2.32 billion.


Net profit for the six months ended Dec. 31 was NZ$1.0
billion ($834 million) compared with NZ$165 million in the year-earlier period.


The company said that its first-half profit rose 52
percent as depreciation and other costs fell after separating its Chorus
network unit.


The results are the first since the company demerged its
infrastructure unit Chorus in November as part of a deal with the government
that will see Chorus build the majority of a nationwide broadband network.


The company included a NZ$28 million currency gain and
earthquake insurance payments. Depreciation fell NZ$93 million.


The company expects second-half adjusted earnings will be
NZ$160 million to NZ$190 million. Second-half operating profit is expected to
be about NZ$560 million.


First-half operating profit or earnings before interest,
tax, depreciation and amortization, for continuing operations rose 0.2 percent
to NZ$488 million.


“The business is in really great shape and that’s
what the hard work over the last 12 months has been all about–getting the
demerger done but more than that driving the efficiency of the business,”
said Paul Reynolds, telecom chief executive.


The company gave guidance of NZ$160 million-NZ$190
million for second-half adjusted net profit and around NZ$560 million for
adjusted earnings before interest, tax, depreciation and amortization. Capex is
likely to be between NZ$190 million and NZ$220 million, it said.


The company also announced it would buy back a maximum of
200 million ordinary shares for a total purchase price of no more than NZ$300


The company plans to pay a fiscal first-half dividend of
nine New Zealand cents a share.


Auckland-based Telecom NZ is the country’s largest
fixed-line phone company by subscribers and revenue.


Last year, Telecom New Zealand closed down its CDMA network 31st July 2012. The company
added that  it would be closing down its CDMA network in mid-2012, and no
devices or communication will be able to take place on this network after that.


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