Vocus HY17 Profit Dives 21%, Downgrades Guidance, Drops Dividend
Just days after copping customer complaints for a power outage at its Sydney data centre, Vocus Group has downgraded its FY18 underlying net profit [after tax] guidance from $140 million – $150 million, to $125 million and $135 million.
The company cites challenges within its consumer division, including “over-hedging” of its energy portfolio and amendments to its go-to-market strategy.
For the six months to December 31st, Vocus posted a 9% YOY increase in revenues, to $967.3 million.
Net profit dived 21% to $37.3 million, versus $47.7 million a year earlier.
EBITDA for the period climbed 1% to $188.8 million.
The company has also decided not to pay an interim dividend, as it focuses on reducing its debt leverage and invest in projects such as the Australia-Singapore subsea cable.
The Australian Singapore Cable is reportedly on track to service in the first quarter of 2019.
Vocus’ enterprise and wholesale division notched 2.5% revenue growth. Its consumer division posted a 5.7% uptick in revenue, despite “challenging market conditions”.
The company’s consumer NBN market share has increased to 7.7%. – only to slow down in Q2FY18, following its decision to cease promoting HFC (hybrid-fibre coaxial) services, citing issues in customer experience.
The NBN Co. has also opted to pause its HFC rollout for similar reasons.