NBN migrations boost Optus revenue, but 1H profit drops

The telco's weak enterprise results hit Singtel

Credit: 38767309 © Tktktk Dreamstime.com

An an increase in customers and higher NBN migration payments helped the Optus' revenue grow 1.8 per cent to $4.4 billion for the six months ended 30 September, but that was not enough to help Optus' profit.

Net profit after tax for the half year was $235 million, or a 9.3 per cent decrease year-on-year, while EBITDA grew eight per cent to $1.4 billion.

Optus said its enterprise business experienced "weaker performance" which affected the telco's parent company results. A decline in legacy products and reforms in the finance sector were the main issues affecting the enterprise business in Australia.

The company had already registered a decline in enterprise revenue for the year ended 31 March with a 2.7 per cent drop to $1.4 billion. 

Parent company Singtel's second quarter results saw group enterprise revenue drop by 5.3 per cent while EBTIDA was down by 12 per cent; however, excluding Australia, enterprise revenue grew 1 per cent.

Meanwhile, Optus' consumer business saw a 6.5 per cent increase in operating revenue due to higher NBN migration revenue.

That was supported by the telco's NBN Concierge Program which lifted new NBN connections to a record 80,000 in the second quarter.

Even though mobile revenue for second quarter was down 3.7 per cent, Optus saw a 1.6 per cent increase for the half year, posting $2.7 billion in mobile revenue. The telco also saw a 1.2 per cent increase in the total number of mobile subscribers.

In May, Optus confirmed reports that it expected approximately 200 redundancies as a result from changes to its consumer business. This was confirmed as the company headcount went from 7297 to 7092.

Optus recently announced support for mobile services based on 5G as well as the expansion of its home broadband service based on the wireless technology. It has 300 5G fixed wireless sites in Australia and says it is on track to deliver 1200 sites by March 2020.

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