Internet and mobile growth aid Telstra

By Phil Boeyen, ShareChat Business News Editor

Wednesday 7th March 2001

Australian telco Telstra (NZSE: TLS) has delivered a half-year result within analysts' expectations, making an after-tax profit of A$2.6 billion, up 25% from the previous period.

Normalised earnings before interest and tax for the period grew 10.4% to A$3.54 billion, with sales revenue up 5% to A$9.74 billion.

CEO Ziggy Switkowski says revenue growth shows that 56% of sales revenue came from mobiles, data and internet services and 44% from "traditional" areas.

"Seven years ago non-traditional products made up a quarter of our revenue. Today's result reinforces that our four-pronged strategy to be a successful, contemporary communications and information service company is delivering despite continuing regulatory intervention and intense competition.

"We are becoming a web-enabled, customer-focused, service organisation. We're doing more with less and providing a diverse range of modern communications products.

Mr Switkowski says the company's strong focus on cost control continues to pay off and forecast savings from the current cost reduction program are being achieved.

The company's normalised operating expenses increased by just 1.4% to A$5 billion, helping operating margins to improve from 34% to 36%.

Although revenue from local calls fell more than 20% compared with last year and national long-distance fell 5%, mobile revenue grew 11% and internet and data services rose 18%.

Telstra's directors have declared a dividend of A8 cents per share fully franked representing a payout of A$1 billion.

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