Vodafone halves loss in first half

Vodafone Hutchison Australia has revealed a loss of $81.5 million for the six months to June 2017, down more than 50 per cent compared to the first six months of 2016.

The telco, a 50:50 joint venture between Hutchison Telecommunications and Vodafone, reported revenue of $1.65 billion for its first half, with EBITDA growing 15.9 per cent year on year to $477.3 million.

“We’re really pleased with the solid results for the first half of the year, and this reflects our strong network and continued significant improvements in customer satisfaction,” chief financial officer James Marsh told a results briefing.

The growth in EBITDA was attributable to the telco’s revenue growth as well as “strong commercial discipline,” the CFO said.

“This has allowed us to cut our loss in half at the same time as investing almost $2 billion in technology this year,” he added.

That $2 billion includes almost 1800 new and upgraded mobile sites, spectrum licence payments, and VHA’s continued fibre transmission rollout. In April the telco spent $286 million to pick up spectrum in the 700MHz band. The telco also spent $544 million on renewing its spectrum in the 2100MHz band.

Average revenue per user (ARPU) grew 2 per cent to $45.89, supported in part by the telco’s $5 roaming offer; there was a 20 per cent uplift in roaming revenue, Marsh said.

Customers increased by 190,000 to 5.7 million, representing 3.5 per cent growth on a year-on-year basis. Post-paid customers grew 1.8 per cent, Marsh said.

The CFO said that VHA had also seen strong growth in customers on MVNOs and customers acquired under non-Vodafone brands.

In the second half of 2017 Vodafone is set to offer its first fixed-line broadband services, launching its National Broadband Network offering.

The company this morning revealed its NBN customers would be equipped with modems that include a 4G-capable SIM card, allowing them to have access to mobile broadband while they wait for service activation and during NBN outages.

Earlier today Vodafone’s chief strategy officer, Dan Lloyd, called for significant changes to NBN’s wholesale pricing model.

Vodafone is currently locked in a battle with the Australian Competition and Consumer Commission, with Telstra and Optus taking the ACCC’s side in a federal court battle. The legal action relates to the ACCC’s inquiry into whether it should introduce a regulated mobile roaming service.

The ACCC in May released a draft decision that said it would not introduce regulated roaming. Vodafone has come out strongly in favour of roaming.

Copyright © 2017 IDG Communications, Inc.

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