TPG cruises past a quarter of a million NBN customers, thanks to iiNet

Telco’s revenue grew by 88 per cent in FY16

TPG ended its financial year with 119,000 customers on the National Broadband Network — a figure that grows to 276,000 when the contribution from iiNet, which TPG acquired last year, is factored in.

However, TPG revealed that the total number of iiNet customers had dropped compared to June 2015.

TPG had ended FY15 with only 44,000 NBN subscribers. The telco is the number two retail service provider on the National Broadband Network, trailing Telstra.

TPG registered another leap in its full year profit. The telco today revealed a net profit after tax of $379.6 million for the year ended 31 July, up 69 per cent over FY15’s $221.4 million.

EBITDA grew 75 per cent to $849.4 million, with TPG reporting underlying revenue of $2.39 billion (up 88 per cent). Excluding a number of irregular items relating to the acquisition and integration of iiNet and TPG disposing of Vocus shares, underlying EBITDA was $775.3 million, up 60 per cent on FY15.

TPG reported growth across both its consumer and corporate divisions.

TPG said its consumer division ended the year with 885,000 broadband subscribers — up 64,000 on the previous year — and 304,000 mobile subscribers. Consumer EBITDA was up 7 per cent to $255.7 million.

Corporate division EBITDA was up 11 per cent to $269.3 million (excluding a $10.1 million impact relating to iiNet, the division’s EBITDA was up 15 per cent).

TPG said that iiNet contributed EBITDA of $242.6 million, which included 11 and a quarter months as a part of TPG. (iiNet reported underlying EBITDA of $201.7 million in FY15.)

“The principal drivers of the [iiNet] FY16 EBITDA growth were (i) realisation of post-acquisition integration benefits, (ii) nine months of lower access costs arising from the ACCC’s fixed line services final access determination, and (iii) an increased contribution from Tech2,” TPG said in a statement.

The TPG subsidiary ended the year with 983,000 broadband subscribers. That represents a drop compared to 989,000 that iiNet had at the end of June 2015. TPG said that the over trend for iiNet improved after the end of FY16, with net positive growth in August following the release of new plans.

TPG said that at 1.4 per cent, the churn of its consumer division, was slightly lower than iiNet's overall churn rate of 1.5 per cent.

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