Telstra has shelved plans to sell part of its InfraCo Fixed business unit for the time being, as it handed down its full-year results showing a 13.1 percent increase in profit to $2.1 billion.
A divestment of some part of InfraCo Fixed had been mooted since late last year, and gained steam in February this year when The Australian reported that Barrenjoey had been brought in by Telstra to test sale options.
Telstra previously sold a non-controlling stake in its mobile towers business, at the time known as InfraCo Towers but since rebranded Amplitel, which had further supported speculation of a similar divestment of part of the fixed-line business.
But CEO Vicki Brady said today that “after thoroughly examining alternatives, we have concluded that the greatest value to be created for shareholders is by maintaining the current ownership structure of InfraCo Fixed, for at least the medium term.”
She added that Telstra is seeing “strong customer demand for our infrastructure … shaped by the shift to the cloud and rapid AI adoption driving data centre and edge requirements, along with needs for domestic fibre and undersea cable.”
By the numbers
Telstra’s mobile business continues to drive growth, with the telco seeing a 5.4 percent total uplift in full-year revenue and a 13.1 percent increase in profit.
Full-year revenue came in at $23.2 billion, and full-year EBITDA was up 8.4 percent to $7.9 billion.
Mobile revenue rose 8.3 percent for the 2022-2023 financial year to over $10.3 billion, the largest single contributor to Telstra’s income of $23.2 billion.
Fixed network revenue fell 0.6 percent to $4.5 billion, while fixed enterprise fell 1.6 percent to $3.6 billion.
Telstra’s Digicel Asia Pacific acquisition helped Telstra International grow 62 percent to $2.4 billion.
“We’re really pleased with the performance of the mobile business”, CEO Vicki Brady said, citing strong growth in mobile data in the last year, something Telstra expects to continue.
“We achieved our FY23 5G population coverage target of 85 percent, and 41 percent of our mobile traffic was on 5G.
“We’ve brought more capability into our 5G network, including 5G standalone.
“This means we can carve up our network into separate, secure slices that can support lower latency and be finely tuned to suit the needs of our customers.”
No comment on latest NBN SAU
Telstra offered only muted criticism of the latest NBN SAU revision announced yesterday, despite the redraft using a price proposal for 50Mbps plans and below that the telco does not support.
NBN Co decided to use a tariff offer for 50Mbps services and below that Telstra and Optus were both already known to oppose.
Telstra told the ACCC [pdf] that this is “the worst solution”, since it would drive up the carrier’s connectivity cost.
However, Brady said, since the 400-plus-page SAU was only filed yesterday afternoon, it’s too soon for Telstra to offer a specific response.
“We’ve still got to work through that. But as we step back … obviously we’ll think about all the commercial levers we have,” she said.
However, Brady said NBN Co’s Fibre Connect rollout offers the chance to move customers to higher-speed services that offer better margins on connectivity.