A strong fourth quarter wasn’t enough to offset Optus’ NBN hiccups, with the Singtel-owned company announcing a 16 per cent drop in full-year net profit.
Optus’ profit fell to $659 million from $782 million a year ago, despite the company’s operating revenue edging 5.7 per cent higher to $9.09 billion on customer growth and higher equipment revenues.
The temporary suspension of the NBN’s hybrid fibre coaxial (HFC) network continued to weigh on the balance sheet, while higher depreciation and amortisation costs helped push total operating expenses 7.6 per cent higher to $6.54 billion for the year.
Chief executive Allen Lew said on Wednesday the telco enjoyed a better fourth quarter, with net profit increasing 12 per cent to $228 million for the three months to March 31, driven by a combination of customer growth, higher equipment sales and higher NBN migration revenue.
Optus added 126,000 post-paid mobile subscribers for the quarter, about a third of its total new post-paid subscribers for the year.
The 50,000 new NBN customers it added for the quarter also represented 36 per cent of the year’s 137,000 new subscribers.
Offsetting this was a 109,000 decline in fourth-quarter prepaid customers, impacted by deactivations of 125,000 inactive customers by a major wholesale customer.
“Optus achieved a very strong performance in the fourth quarter underpinned by a relentless focus on delivering exceptional network and customer value to drive customer growth and engagement,” Mr Lew said.
However, the temporary suspension of the NBN’s HFC network rollout continued to wreak havoc on migrations to the service and, in turn, the full-year result.
The rollout was suspended from November 2017 to April 2018, with Optus’ fourth quarter numbers lifting in line with the resumption.
Earnings was marginally down at $2.7 billion for the year.
Mr Lew said the company would continue its focus on exclusive football content, including the finals of the UEFA Champions League and Europa League and the 2019 FIFA Women’s World Cup.
“Optus Sport will be the only broadcaster covering all 52 matches of the Women’s World Cup and has also launched its improved NatGeo app, featuring Optus’ exclusive content ‘Only in OZ’,” the company said in a release.