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Vodafone Australia halves loss to AU$82 million for half-year

Telco intends to spend AU$2 billion on mobile technology including spectrum in 2017.
Written by Chris Duckett, Contributor

Vodafone Hutchison Australia has reported a half-yearly loss of AU$81.5 million, a 50 percent decrease on the AU$164 million loss reported at the same time last year.

In the six months to June 30, 2017, Vodafone added 190,000 customers to its network, bringing the total to 5.7 million users.

Broken down, the telco saw a 1.8 percent increase in postpaid customers to 3.367 million; a 1 percent drop in prepaid customers to 1.663 million; and a massive 28.7 percent jump in MVNO customers to 654,000 customers.

Vodafone chief financial officer James Marsh told journalists on Tuesday that a large portion of the MNVO increase was due to Kogan Mobile.

For the half-year, the telco increased revenue by 3 percent to AU$1.7 billion, with earnings before interest, tax, depreciation, and amortisation registering a 16 percent increase to land on AU$477 million.

The telco touted a AU$2 billion investment in "mobile network and technology" which would include approximately 1,800 new and upgraded mobile sites, costs of acquiring spectrum, and improving its transmission network.

"We have a world-class network and are continuing to invest heavily to make it even better for our customers, including in regional areas where we are building or upgrading around 450 sites this year," Marsh said.

In April, the company parted with AU$286 million to gain 2x 5MHz of spectrum in the 700MHz band. The company has also renewed its 2100MHz spectrum for AU$544 million.

The company also reported a 20 percent increase in roaming revenue, while average revenue per user increased 2 percent to AU$45.89.

Looking forward, the company said it would be refreshing its postpaid plans, as well as launching fixed broadband offerings on the NBN.

"Our new postpaid products, to be revealed later this month, are going to change the rules. Just as we have done for international roaming and prepaid, we are going to shake up the market," Marsh said.

"Preparations for our fixed broadband launch are also ramping up, and we know that many Australians are currently unhappy with their current internet service provider."

Hutchison Telecommunications, half-owner of Vodafone, said in its half-yearly results that Vodafone would be launching Wi-Fi calling, a commercial narrowband IoT service in Melbourne, and continue with 5G testing.

Hutchison continued to state that the ACCC decision to cut mobile termination rates was hitting its average revenue per user.

Earlier on Tuesday, the telco announced it would launch its NBN services with a modem that included a free-of-charge backup 4G connection.

The backup connection will provide maximum speeds of 12/1Mbps, which is equivalent to the slowest NBN speed tier available, and will be activated at sign-up and remain active for 30 days. In the case of an outage, it can be reactivated, via phone or live chat, once the telco has conducted line tests to check a fault exists in NBN's infrastructure.

Vodafone general manager of Fixed Broadband Matthew Lobb told ZDNet the 4G connection was "very much a backup service".

"[We will be] very careful not to impact the mobile network," he added.

Vodafone is currently involved in a court case against the ACCC over the process of its decision not to declare domestic roaming in Australia.

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