TelstraClear boosts earnings 2.3% in New Zealand

TelstraClear boosts earnings 2.3% in NZ, currency clips gains for Australia

August 13 (BusinessWire) – TelstraClear Ltd., the New Zealand-subsidiary of Australia’s Telstra, posted a 2.3% gain in full-year earnings as more people signed up to its broadband services. Still, in Australian-dollar terms the resilient kiwi eroded the parent company’s gains.

Total income was NZ$671 million in the 12 months ended June 30, up from NZ$656 million a year earlier, the company said in a statement. In Australian-dollar terms, income fell 2.7% to A$547 million. The New Zealand arm of the company contributed a A$13 million loss to the parent company’s overall earnings. TelstraClear accounts for around 2.1% of the company’s total income.

Higher operating expenses were “a result of higher bad and doubtful debts associated with the current challenging economic times and an increase in promotion and advertising,” the company said in its commentary.

Parent Telstra Corp. today reported net profit of A$4.07 billion for the year, from A$3.69 billion last year.

The shares fell 1.1% to A$3.57 on the ASX today and have fallen 6% so far this year.

TelstraClear slashed capital expenditure by 15% to NZ$96 million, despite the roll-out of its cable and digital subscriber line as it accesses the unbundled local loop. It expects to be the country’s “biggest participant” in the process.

Last month, it signed a deal to resell mobile services through Vodafone NZ, ruling out the possibility it would migrate on to Telecom Corp.’s XT network. The three-year deal will see TelstraClear offer 3G mobile services from the last quarter of this year.

(BusinessWire)

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