M2 upgrades FY11 profit outlook by 20%

Wholesale and retail telecom service provider M2 (ASX:MTU) has raised its FY11 profit forecast to up to $31.9m

M2 Telecom (ASX:MTU) has upgraded its earnings guidance for FY11 by up to 20 per cent, on the back of its recent acquisitions and more favourable business agreements.

The company is now forecasting underlying net profit of between $30.4 million and $31.9 million, a 20 per cent increase in the midpoint range compared to guidance issued at the start of the financial year.

Revenue is projected to grow 5.7 per cent to between $450 million and $470 million, while ebitda is set for 18 per cent growth to $48.5 million-$50 million.

M2 has attributed the increased expectations to its recently-completed acquisitions of the business assets of Clear Telecoms for $24.5 million and AUSTAR's mobile customers for $2 million.

The operator is also expecting improvements in wholesale purchasing arrangements for some telecom services in the financial year.

Audited results for the full-year are scheduled to be released on 29 August.

M2 provides retail and wholesale fixed and mobile telecom service, and has been the exclusive post-paid mobile services aggregator for Optus since mid-2006.

MTU shares fell 2.35 per cent on Monday to $3.740.

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