21 Aug 2019

Spark makes larger annual profit off market share growth

11:02 am on 21 August 2019

Spark's annual profit has increased with greater market share and lower costs.

Spark's headquarters in Auckland

Spark has posted a full year net profit of $409m. Photo: RNZ / Kim Baker Wilson

The telecommunication company's net profit rose 12 percent to $409 million in the year ended June.

Revenue was flat at $3.5 billion as growth in sales of its broadband and mobile services offset declines in its fixed line telephone services.

Spark chair Justine Smyth said the company was on track to meet the targets it set two years ago.

"We have grown our business in the highly competitive mobile and cloud services categories, held our broadband position, entered new markets like sports streaming, led on cost management and transformed our company culture."

A restructure had cost the business in previous years, but it was now seeing a reduction in total operating expenses.

Spark chief executive Jolie Hodson said it would push ahead with a 5G network but needed the necessary radio spectrum.

"We are pleased the government signalled recently it is considering an early, temporary allocation of some spectrum within the 'C Band' earmarked for 5G - as this would enable rapid delivery of 5G services while the details of the longer-term spectrum allocation process are sorted through."

The Government Communications and Security Bureau (GCSB), has refused Spark's application to use Chinese technology firm Huawei's equipment in the rollout of a 5G data network.

Competitor Vodafone has stolen a march on Spark with a plan switch on a 5G network in some main centres by Christmas.

Spark would pay a full year dividend of 25 cents per share.

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