Optus Business earnings down by 8.9 per cent

Optus Business earnings down by 8.9 per cent

Staff headcount down by 369 in last quarter

Optus Business has reported a quarterly increase in revenue but earnings were down 8.9 per cent, with the unit posting $59 million in earnings before interest, tax, depreciation and amortisation (EBITDA).

According to the latest results posted by parent company Singtel, Optus Business revenue was up 6.6 per cent, reaching $386 million, a result of the growth in ICT services and mobile.

A growth in cyber security, cloud and unified communications resulted in 18 per cent growth in ICT and managed services growth.

Voice revenue fell 11 per cent was due to price erosion and declines in switched voice as businesses migrated to lower cost IP-based voice solutions.

Optus Business maintained growth of its suite of ICT products and services with long-term customers such as the Australian Tax Office and the Department of Home Affairs, alongside continuing to acquire new customer mobile fleets, including NSW Uniting Care and the Queensland Ambulance Service.

Overall, Optus revenue grew six per cent year-on-year to $2.2 billion during the first quarter, while EBITDA was slightly up, with a 1.6 per cent increase posting $656 million.

Net profit after tax (NPAT) was $154 million, down 3.5 per cent - Optus attributed this result mainly to lower NBN migration revenue.

Excluding NBN migration revenues, EBITDA and NPAT increased five per cent and 10 per cent respectively.

Delving deeper, mobile service revenue rose two per cent to $963 million. In Mass Market Fixed, operating revenue decreased one per cent due to the temporary suspension of the NBN HFC connections.

Excluding NBN migration revenues, Mass Market Fixed revenue grew five per cent on an enlarged base of 483,000 NBN broadband customers, an increase of 204,000 and 30,000 for the year and quarter respectively.

The company headcount was down by 369 staff as expected, going from 8,515 on 31 March to 8,146 on 30 June.

In February, the company revealed its full year results with Optus Business seeing a year-on-year decline in revenue for the quarter ending December 2017. However, the business unit's pre-tax earnings (EBITDA) grew by five per cent for the quarter. 

Optus Business ICT and managed services revenue had declined 13 per cent year-on-year attributed to phasing contracts, posting $146 million. In the previous quarter the segment had shown a 15 per cent increase.

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