TeamTalk boosts FY profit 25% as broadband business grows
By Paul McBeth
Aug. 25 (BusinessDesk) - TeamTalk Ltd., which owns the CityLink fibre optic network, lifted annual profit by a quarter as it boosted broadband service sales.
Net profit rose to $4.7 million, or 21.4 cents a share, in the 12 months ended June 30, from $3.8 million, or 18.3 cents, a year ago, the Wellington-based company said in a statement. Broadband sales rose 15% to $14.6 million, making up 46% of the group’s $32 million revenue.
TeamTalk flagged annual earnings before interest, tax, depreciation and amortisation growth of between $500,000 and $1 million for the next three years. In the 2012 financial year, that growth will probably be at the lower end of the range due to investment in research and development.
“Undoubtedly other opportunities will emerge to either create new revenue streams from scratch or to acquire existing lines of business,” chairman Joe Pope and managing director David Ware said in a statement. “For the first time in many years our cheque book is cautiously open.”
In May, the company’s subsidiary CityLink signed a deal with the Wellington City Council to rollout free wireless internet connectivity across large parts of the CBD, the first city in New Zealand to do so.
That came after TeamTalk missed out on making the short-list to grab a share of government funding in building a nationwide ultra-fast broadband network. Most of that contract ultimately went to Telecom Corp., which will have to carve itself into two separate companies as part of the deal.
TeamTalk’s board declared a final dividend of 10 cents a share, taking the total payout to 20 cents.
The stock rose 0.5% to $2.15, and has gained 3.9% this year.