Acquisitions pay off as iiNet returns record FY13 first half

DSL ISP, iiNet, has returned a record result for the the first half FY 2013 with net profit after tax up 122 per cent to $32 million.

Ina statement on the ASX, the company said this was due to increased revenues and improved margins following the acquisitions of Internode and TransACT in 2013.

Managing director and CEO, Michael Malone, said iiNet had grown to a scale where earnings and cash flow generated could be reinvested to ensure the company met customers' needs going forwards.

"The company's strong cash flows have enabled us to pursue attractive strategic acquisitions, quickly pay down debt and grow dividends,"Malone said. ïiNet's recent entry into the S&P/AS200 Index is a milestone we are all very proud of.

The company reported:

• Revenue was up 30 per cent to $474 million
• EBITDA up 73 per cent to $98 million
• NPAT up 122 per cent to $32 million
• EPS up 106 per cent to $0.198 per share
• Operating cash flows up 204 per cent to $72 million
• Customer driven strategy generating industry-low levels of churn
• Its business segment continued to grow strongly, generating $90 million revenue.
• Increased shareholder returns with interim dividend up 33 per cent to $0.08 per share fully franked

Malone said iiNet had strengthened its position as the clear No.2 broadband DSL provider following the acquisitions of TransACT and Internode.

"The successful integration of these acquisitions, and others before them, has driven substantial synergy benefits and improved margins as iiNet has leveraged its platform and improved service and product levels in the acquired businesses."

Malone also underscored iiNet's commitment to the National Broadband Network, calling it an "exciting opportunity".

He also welcomed the announcement by the Australian Competition and Consumer Commission (ACCC) during the half-year of a final determination of the access dispute relating to IIC charges levied by Telstra Corporation Limited.

"The determination has delivered a back-dated refund to iiNet of approximately $8 million for excess IIC charges in prior periods," Malone said.

The company was in the best position it has ever been in its 20-year history, he said.

Register now for the ARN Security Forum 2013 on June 4 at the Sydney Mint

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