Photo: 123RF
Telecommunications company Spark has reported a big jump in profit after selling the majority stake in its mobile towers and quitting its sports streaming business.
Key numbers for the year ended June compared with a year ago:
- Net profit $1.14b vs $410m
- Revenue $4.49b vs $3.72b
- Adjusted profit $433m vs $410m
- Adjusted underlying earnings $1.19b vs $1.15b
- Final dividend 27 cents a share vs 25 cps
The company said the TowerCo deal and the exit of Spark Sport resulted in a gain of $529 million in underlying earnings.
Spark chairperson Justine Smyth said the company's strong revenue growth and cost control have underpinned earnings and dividend growth.
"The board and I are pleased to complete the current three-year strategy period delivering to guidance, and with a strong platform for future growth," she said.
"The strategic review of Spark's infrastructure assets resulted in the divestment of a 70 percent stake in its TowerCo business to the Ontario Teachers' Pension Plan for $911 million, enabling us to return value to shareholders while investing in future growth."
Spark allocated $350m of the TowerCo proceeds to an on-market share buy-back.
The company said broadband connections remained broadly stable in line with strategy, but strong competition meant revenue fell 2 percent to $626m.
Its mobile service revenue rose 9 percent to $980m, driven by strong connection growth and the return of roaming to 86 percent of pre-Covid levels.
Jolie Hodson Photo: Spark
Cloud, security, and service management revenues fell 2.2 percent to $436m.
Chief executive Jolie Hodson said Spark remained focused on delivering on its promises despite the volatile economic environment.
"In mobile we lead the market on both connections and service revenue, and we have maintained our leading position in broadband in the face of ongoing input cost escalation and high levels of competition," Hodson said.
"I am particularly pleased that we have been able to shift from our traditional telco roots to broader digital services over the last three years, with legacy products like landline voice now below 6 percent of overall revenues and a growing high-tech portfolio," she said.
The company forecast underlying profit to be between $1.22b and $1.26b for 2024, while its dividend guidance for the upcoming year was 27.5 cents per share.