Telecom’s net profit has dropped 56 percent from $382 million to $166 million for the past financial year after it wrote off $257 million from the value of the business – and it’s lost 95,000 customers due to plans to shut down the old CDMA network.
Chief executive Paul Reynolds said the lost customers were mostly made up of low-value prepaid CDMA customers going inactive, which had "minimal" impact on revenues.
He said Telecom remained on track to kill off CDMA by July next year.
Telecom posted a profit of just 1.6 percent, which Reynolds said represents a “strong operating performance” in an increasingly competitive environment.
The company’s full-year net earnings increased by $6 million to $388 million – excluding a number of adjustments including an $18 million gain on the sale of its Australian AAPT consumer, $29 million of UFB and demerger costs, $42 million of earthquake-related costs and asset impairments of $257 million, plus an $88 million tax effect.
Telecom's adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) grew 2.1 percent to $1.8 billion.
Full-year adjusted revenue was $5.1 billion, down 3.2 percent on last year, while expenses dropped 5.8 percent to $3.3 billion.
Gen-i, Telecom retail and Chorus all reported gains in EBITDA for the second half of the year on the equivalent period last year, while Wholesale and International fell by nearly 25 percent.
Telecom is currently preparing to demerge its retail business from the Chorus network unit, something Reynolds said it hoped to do by the end of the year. More information would be sent to shareholders shortly.
If the demerger passes a shareholder vote, Chorus will become a separate public company tasked with rolling out UFB.