6 Sep 2016

Vodafone slashes annual loss as sales rise

9:48 am on 6 September 2016

Vodafone New Zealand has cut its full year loss from $90.5 million last year to $18.3 million in 2016, with sales rising slightly in the year ended March.

Vodafone signage

Vodafone signage Photo: RNZ / Calvin Samuel

Revenue at the mobile services company rose almost 2 percent to $2 billion, with an underlying profit up nearly three times on the year earlier to $50.2m, compared with $17.2m.

The 2015 loss had been restated from the $121m loss originally reported, as Vodafone had adopted a Reduced Disclosure Regime, which required it to account for deferred tax.

This year's result reflected lower financing costs and a cash injection of $300m from its UK-based parent, Vodafone Group.

"The combined increase in revenue and decrease in operating and finance costs has seen a $72-m improvement in profit after tax," said Vodafone NZ chief executive officer Russell Stanners, adding that the debt was refinanced at lower interest rates.

He said the results met Vodafone's expectations and positioned the company well, ahead a planned merger with pay television operator Sky Network Television.

"In a highly competitive industry, it is important we continue to grow, be nimble, bring innovative ideas and products to the market quickly, and provide kiwis with world leading mobile technology and superior wireless and fixed broadband services."

In addition, he said last year's acquisition of the telecommunications business services provider, WorldXChange, provided Vodafone with new revenue streams to help the company's growth.

"We plan to continue the momentum built in the last financial year. We are excited about the future and our ability to deliver innovative products and services that change the way kiwis live, do business and relax."

Mr Stanners said he expected the Commerce Commission to make a decision on its merger plans with Sky TV by November 11, even though the Commission recently announced a six-month delay to make a decision on another merger between the media companies, Fairfax New Zealand and NZME.

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