Aussie Broadband completes mobile migration to Optus as first half revenue climbs
Aussie Broadband has continued its impressive revenue growth, reporting a 49% increase to AU$237 million for the first half of fiscal 2022 to December 31 when compared to the same period last year.
During the half, the company made a AU$390 million bid for Over the Wire, and when those costs are excluded, Aussie Broadband reported earnings before interest, tax, depreciation, and amortisation (EBITDA) of AU$9.1 million, a 7% increase on last year.
In its first-quarter results, the company said it only had 3,000 customers left to switch from Telstra to the Optus network, and on Tuesday said that work was now completed.
"Mobile net additions for 2Q were 2,647 or 31% lower than in 1Q due to a combination of factors including limited availability of mobile handset options, some loss of services due to coverage following the migration to the Optus network, and delays in providing the ability for customers to sign up online for mobile services," Aussie Broadband said.
"Limited handset availability (due to global chip shortages) has hindered growth in mobile services. The team is presently working to expand the handset range available to Aussie customers."
Nevertheless, the company reported it increased mobile customers 70% year-on-year to 32,200.
On its fixed broadband network, the company reported connections grew 45% compared with last year, and consisted of 422,000 residential lines, up 35%, almost 45,500 business connections which represent 67% growth, and wholesale customers spiked from 1,800 last year to 27,286.
"The business segment remained strong. So far in 1H FY22 we have taken 15% of all NBN enterprise ethernet net service activation orders," the company said.
"Net residential broadband additions for 2Q were 25,582. Promotions continued throughout the quarter and there was a modest increase in churn during December and January as customers started to migrate off the 'focus on fast' promotion."
During the second quarter, Aussie Broadband had 17,800 additions to its wholesale and white label services, which included 8,725 migrated white label services. The company said the migrations would continue and it was looking for new partners in the segment.
For the NBN, Aussie Broadband said it had 5.66% of the market excluding satellite connections.
"2Q saw an easing of the CVC challenges experienced in 1Q, with lockdowns removed in late October and early November, although some benefit continued from the 51,000 customers proactively migrated to NBN higher speed tiers at the start of the financial year," it said.
"These benefits will end in January 2022, and the impact will be determined by the proportion of those customers who elect to remain on the higher speed plans.
"Total CVC expense for the quarter was $1.8 million, a decrease of 45% on the previous quarter after accounting for NBN relief ($0.2m) and increased inclusion benefits from migrated customers ($1.0m)."
On the NBN pricing revenue, although it welcomed access pricing, the telco said the most popular 50Mbps plan was still not sustainable and a lack of concrete timeline created short and medium-term risk to telcos.
From March, the company says it would start to see savings from its backhaul fibre build, which would allow it to begin to exit its current Telstra backhaul agreements.
Overall, the company reported 636,446 total services which represented 41% growth on last year.
On Monday, Spirit Technology Solutions reported its first-half revenue increased by 54% year-on-year to AU$66 million, and included a record second quarter of AU$35 million. Despite the result, EBITDA was down 5% to AU$4.2 million.
"The operating environment in the first half of FY22 was very challenging with cost pressure across the business, through needing to maintain staff levels during lockdowns across Melbourne, Sydney and Brisbane, employee isolation requirements and supply chain delays," the company said.
"Spirit will partially offset these cost pressures through price rises in H2 FY22."
The company added it was in a period of due diligence with a buyer for its fixed wireless tower assets.