Internet service provider, iiNet (ASX:IIN) witnessed its earnings growing faster than its revenue as its margins had significantly improved for the 2013 financial year ending June 30.
Revenue was up 13 per cent to $941 million, net profit increased 64 per cent to $60.9 million and EBITDA was up 29 per cent to $187 million.
iiNet’s CEO, Michael Malone, said its focus for FY13 was to maintain the strong momentum of FY12 and continue executing on its growth strategy centered on service, brand, innovation and scale.
“Core to everything we do is delivering market leading broadband and telecommunications services to our customers. Our strong financial performance over the past twelve months, during challenging economic conditions and an increasingly competitive market, is a clear demonstration of our ability to deliver,” Malone said.
With the integration of TransACT and Internode complete, at June 30 iiNet had 840,000 broadband customers with over 1.7 million services. Earlier this month, it also bought Adam Internet, which will grow its total customer base to over 900,000 broadband subscribers, adding 70,000 new broadband subscribers across residential and business markets.
“Broadband sales continued to increase and we returned to net broadband additions in the second half of FY13 from a combination of new marketing campaigns, new products and new market share in NBN roll-out areas,” he said.
“While revenues have increased, margins have grown more as acquisition synergies have been delivered, cost-out initiatives have been implemented, and products per customer have increased to 2.23.”
iiNet’s business division performed strongly with revenues growing 53 per cent to $183 million. This segment now makes up 19 per cent of group revenues.
“We are successfully capturing the latent market potential in a segment that has historically been underserved by our competitors,” he said.
Malone said it had taken full advantage of its capabilities to be the first provider to launch NBN services across all access technologies including fibre, satellite and wireless, as well as trialing multicast iiNet IPTV services in partnership with Fetch TV.
“We have embraced the NBN and just passed the milestone of 20,000 customers on NBN. While still small in the context of iiNet’s total subscriber base, we expect this to grow strongly as the roll-out speeds up,” he said.
iiNet recently launched its new ISP brandJiva.