Photo: RNZ
Telecom lines company Chorus has seen a sharp drop in profit of $33m due to rising interest rates and refinancing debt.
Key numbers for the six months ended December compared with a year ago:
- Net profit $9m vs $42m
- Revenue $487m vs $483m
- Underlying earnings $342m vs $347m
- Interim dividend 17 cents a share
Chorus chief executive JB Rousselot said the accelerated depreciation of copper in areas where fibre was available also contributed to the company's reduction in earnings.
Fibre uptake reached 71 percent in completed UFB rollout areas, with growth of 38,000 fibre connections nationwide in the six-month period, Rousselot said.
"The company reached a significant milestone in December when it connected the last community, Opononi in Northland, to fibre under its 11-year public-private partnership with the government," he said.
"It achieved its goal of one million fibre connections in January."
However, he said, a workforce gap of about 380 technicians limited the number of fibre installations Chorus could complete in the period, Rousselot said.
"Like other industries we've experienced workforce challenges in the wake of Covid and we've made significant efforts to reduce the gap to some 220 technicians today.
"We expect to recruit another 150 technicians within a few months.
"In the meantime, the widespread community devastation caused by the recent cyclones means we're having to reprioritise some work so we can focus on restoration efforts."
The company's initial focus had been fixing regional fibre routes so mobile networks could be used by other essential services to help with their restoration efforts, he said.
"We're fortunate that fibre networks are less susceptible to water damage than copper cables.
"Our experience from the recent Auckland city floods, for example, is that we experience fewer faults and faster restoration for customers on fibre."
Share buyback and updated FY23 guidance
Rousselot said Chorus was resuming its share buyback, with $72m of the $150m buyback now completed.
The programme would continue unless more value-enhancing opportunities were identified, he said.
The company also upgraded its full-year earnings guidance between $675m to $690m - Chorus previously estimated its earnings would be between $655m to $675m.
However Rousselot said that guidance did not include the potential impacts of the recent cyclone and flooding events.