The Spark office in Christchurch. Photo: RNZ / Nate McKinnon
Telecommunications company Spark is warning of lower earnings because of belt tightening by consumers, business and government.
The top-10 listed company said it now expected earnings before interest, tax, depreciation, amortisation and net investment income (EBITDAI) between $1.17 billion and $1.21b, from the previous forecast of $1.21b to $1.26b.
It said tough trading conditions have worsened for some parts of its business, especially its IT operations.
"Since the half (year earnings report), public and private sector spending cuts have deepened, and Spark has seen significantly reduced demand in IT service management and professional services and delays to planned digital transformation projects," Spark said in a statement to the NZX.
At the same time, while mobile service revenue and broadband performance remains in line with expectations, sales of mobile devices and accessories have been softer than expected as high interest rates and cost-of-living pressures dampened consumer spending."
Spark said it would speed up its measures to reduce its costs, bring on efficiencies, and balance staff against the performance of various parts of the business.
However, the company maintained its forecast capital spending and dividend payout.