CWO makes $4.1 billion in revenue bonanza

Cable & Wireless Optus (CWO) yesterday reported annual revenue of $4.1 billion for the year ending March 31, 2000.

Continued strong performances in the company's mobile, and data and business divisions, supported by 55 per cent growth in its consumer and multimedia division, produced a profit after tax of $275 million.

The company's EBITA (earnings before interest, tax, depreciation and amortisation) increased 23 per cent to $1.163 billion while profit before tax was $295 million. Profit after tax was $265 million, compared with a $10 million loss the previous year.

Chris Anderson, CWO's CEO, said that the carrier experienced significant growth in all divisions and increased market share. He attributed much of the strong performance to CWO's restructure and strong management team.

The strong mobiles business continued growing for the seventh consecutive quarter to become Australia's fastest-growing mobile service and was Optus' largest revenue generator for the year, recording a 21 per cent increase in revenue to $1.762 billion.

Anderson said that CWO's mobile customers grew by 42 per cent, from 1860 customers in 1999, to 2640 in March 2000, while the churn rate of customers dropped to 22 per cent.

According to Anderson, CWO's pending deal with Richard Branson's Virgin to launch Virgin Mobile in the Australian marketplace, in addition to revenue from emerging services, including WAP, GPRS and SMS, will see continued growth from the division.

Close on the heels of the mobiles division was the data and business division which reported total revenue of $1.516 billion.

Anderson said that revenue from data and IP services drove growth in the division, as well as high-profile wins with customers such as CSC, the Western Australian Police Force, the Australian Tax Office and the Federal Department of Health.

Future growth is expected for the division from DSL and fixed wireless services and new web hosting facilities in Sydney and Melbourne, Anderson said.

Last, but not least, CWO's consumer and multimedia division also performed strongly. While being the smallest division, reporting $867 million in revenue, consumer and multimedia services, which included the broadband network, local call resale and long distance, grew 55 per cent over the previous year.

Local distance and local call resale continued to produce strong revenues, but the most substantial movement was seen from broadband and internet revenue, which increased 108 per cent over the year.

New services and content deals, including interactive TV, are expected to generate new revenues in the future.

Chief financial officer Norman Gillespie said the results "were exceptional" and forecast strong performances for 2001. "Revenue growth will be lower, but we expect more substantial, double-digit growth . . . and double-digit EBITA and bottom-line figures," he said.

Both Anderson and Gillespie acknowledged that CWO would be faced with increased competition and pressure from new entrants over the coming year, but said that the high potential of the consumer and multimedia division, along with continued strong results from the other divisions, would result in continued high profit.

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