27 Aug 2018

Chorus posts 25 percent drop in profit

12:22 pm on 27 August 2018

Telecommunications network operator Chorus has posted a 25 percent drop in profit as it keeps losing customers from the old copper network.

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Photo: RNZ

Its profit fell to $85 million in the year ended June, compared with $113m the year before.

Fixed-line connections dropped by 5 percent, broadband connections were flat, while fibre connections were up.

The company's revenue fell by about 5 percent to $990m as it lost further revenue from the traditional copper-line connections, while its expenses were steady.

However, the company is connecting more people to its fibre network, which it sees as the future drive of earnings.

"Demand for fibre was stronger than ever, and our ongoing fibre rollout means there are now more than 900,000 homes and businesses with our fibre available at their door... this helped grow our fibre uptake from 35 percent to 45 percent," chief executive Kate McKenzie said.

She said Chorus would concentrate on the rollout of the broadband network and improved service to encourage fibre connections.

Chorus has been trialling a television service through its fibre network to consumers and said in time that might attract broadcasters.

It forecast operating earnings for the coming year slightly below the past year's $653m.

Chorus will pay an increased dividend of 22 cents a share and forecast that to rise by another cent this year.