TPG In The Black Despite Mobile Downturn
Telstra rival TPG Telecom has posted a net profit after tax of $734 million for the 2020 calendar year despite a hit to its mobile customer base, a figure boosted by the 2020 merger between TPG and Vodafone.
The figure puts TPG in the black after a $280 million loss in 2019, and represents a 362 per cent increase in net profits; the telco raked in $4.35 billion in revenue over the year, up 24 per cent from 2019, and $342 million of net cash flow in the first six months post-merger.
While the telco grew its share of the fixed broadband market by six per cent to 2.17 million, and its NBN base by 28 per cent to 1.90 million, mobile took a hit across the board: postpaid subscribers dropped five per cent to 3.26 million, and prepaid plummeted 22 per cent to 1.97 million.
TPG Chief Executive Officer and Managing Director Iñaki Berroeta nonetheless celebrated the results, saying they showed how TPG had delivered for customers and shareholders despite the challenges of 2020 and enabled a maiden dividend of 7.5 cents per share.
“In 2020, we completed the merger and delivered on our promises to customers and shareholders in the most trying year for Australia’s economy and society in decades, while managing a number of significant regulatory challenges.
“Our results are pleasing given we were not only managing COVID impacts, NBN headwinds and aggressive market competition, we were also regaining ground following uncertainty around the merger delay and the 5G vendor restrictions,” he said.
TPG and Vodafone completed a $15 billion merger in July last year. According to ASX filings, the massive turnaround in results this year is primarily due to contributions from the former TPG Corporation, as well as a one-off $820m accounting credit to income tax expense.