Telstra plans to hand back at least $1.5 billion to shareholders from the proceeds of its recent stake sale in Chinese online car sales business Autohome.
The telco giant said it is not clear what form the capital return will take and it is still examining various options. It hopes to announce specific details at the time of its full-year results in August, with payments to start in the first half of the 2017 financial year.
Telstra last month announced the sale of 47.4 per cent in Autohome to financial services firm Ping An Insurance Group in a deal worth $US1.6 billion ($A2.08 billion).
It deal fetched it a $1.8 billion profit and left it with a 6.5 per cent stake plus a board seat in Autohome.
The telco has widely been expected to announce either a share buyback or a special dividend to shareholders since the deal, although some analysts had speculated it may retain the cash for acquisitions.
On Monday, the company said it was important to provide the market with information regarding the use of the windfall.
"Creating this type of shareholder value is in accordance with our capital management framework," chief executive Andrew Penn said on an investor call.
"Importantly, we also maintain sufficient capacity to invest in our growth plans for the future."
Telstra has been hunting for mobile growth opportunities in Asia as its mobile dominance at home comes under increasing pressure from rivals Optus and Vodafone Hutchison.
It acquired submarine cable network Pacnet last year for $US697 million, but plans for a $US1 billion expansion into the Philippines collapsed earlier this year after it ended talks with San Miguel to set up a third mobile operator in the country.
On Monday, chief financial officer Warwick Bray said the telco is focused on lifting its sustainable earnings to ensure the policy of paying fully-franked dividends.
He said the transition to the National Broadband Network would have a longer term impact on the company's earnings, on account of access costs and loss of wholesale revenues.
Mr Bray did not specify a time frame, but estimated recurring EBITDA (earnings before interest, tax, depreciation and amortisations) would be lower by $2 billion to $3 billion. He expects the effect would largely stabilise over time.
Telstra plans to offset the impact by raising productivity and targeting reduction in fixed costs.
Telstra in February reported half year net profit of $2.09 billion, on the back of improved mobile customer numbers.
At 1231 AEST, Telstra shares were up 9.5 cents, or 1.8 per cent, to $5.455 each.
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