In a new end of financial year report, Telstra’s net profit after tax fell by 39.6 per cent, decreasing its profits to $2.1 billion for the full financial year, credited in part to issues associated with the construction of the National Broadband Network.
Income has also fallen to $27.8 billion, a reduction of 3.6 per cent.
The final results mean investors will now receive a final dividend of 8 cents per share from the last six months after receiving the same dividend six months ago.
In the result announcement, Telstra estimated that the company’s earnings before interest, tax, depreciation and amortisation was down by $1.7 billion since FY16.
It also estimated it’s around 50 per cent of the way through absorption of the recurring financial impact of the NBN.
Telstra CEO Andrew Penn has also noted increasing competition as playing a role in the final figures.
Calling FY19 “a pivotal year” for Telstra, Mr Penn said: “Notwithstanding the intense competitive environment and the challenging structural dynamics of our industry, it is a year in which I believe we can start to see the turning point in the fortunes of the company from the changes we have embraced.”
Despite any disappointment in the results, the CEO was buoyed by the launch of new products and the strategy announced by the blue chip in June of last year, which has been labelled “T22”.
“We launched 5G, the next generation of telco technology and the platform for future growth for us and our customers. And at the start of the year, we commenced our T22 strategy, where we have made very significant progress,” he continued.
Mr Penn also took the time to note Telstra as having good momentum in reducing costs, with a $1.17 billion reduction since FY16.
According to the CEO, this keeps the telco on track to achieve its $2.5 billion net cost reduction target by FY22.
Cameron Micallef is a journalist at Nest Egg, writing primarily about personal wealth and economic markets.
Prior to this, Cameron worked for Australian Associated Press. He graduated from the University of Wollongong with a double degree in communications and commerce.