Hutchison Telecommunications Australia reports $167.7m loss

Loss of customers, loss of earnings and declined EBITDA to blame

Hutchison Telecommunications Australia (ASX: HTA) has reported a $167.7 million loss for the full year ended 31 December 2011, in contrast with its $73.4 million profit for the same period in 2010.

HTA’s share of Vodafone Hutchison Australia (VHA) service revenue was $2,044.2 million, down 7.1 per cent while operating margin was $1,510.2 million, down 10.7 per cent. In addition, earnings before interest, tax depreciation and amortisation (EBITDA) were $312.7 million, a decline of 34.3 per cent.

At the end of the year, VHA’s customer base was 7.0 million, down from 7.2 million at 30 June 2011.

VHA chief executive, Nigel Dews, said 2011 was a “challenging year” for the company as it recovered from network issues and customers switching to other telecommunication companies , but it had made good progress in many areas.

“Network performance continues to improve and the network rollout remains on schedule,” Dews said.

“Service levels have also improved with wait times and complaint levels down since the start of the year.

“While our customer base declined during the year, our post-paid customer base grew by 16,000 in the second half.”

A shift to smartphones continued to increase, with more than half of VHA’s total handset base now using a smartphone. The number of customers using data on their handset increased 24.2 per cent in the year to 2.7 million at 31 December 2011. The total number of customers using 3G services, including mobile broadband customers, increased by 500,000 during the year to 3.5 million.

HTA’s share of VHA capital expenditure increased 24 per cent year-on-year to $373.8 million.

“Our new 3G 850 megahertz network, built for data, is over two-thirds complete and is now delivering customers a better smartphone experience and we have introduced a network guarantee for new customers,” Dews said.

“Our network upgrade and equipment replacement program is also running at full pace and we have begun to integrate new sites into the network.”

He added that more than 1000 sites are live on the new 850MHz network and a total of 1500 3G 850MHz sites are expected to be live across the network in the third quarter of 2012.

“Equipment has been replaced with new single Radio Access Network (RAN) equipment cross more than 4000 sites,” he said.

Follow Hamish Barwick on Twitter: @HamishBarwick

Follow Computerworld Australia on Twitter: @ComputerworldAU

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