Telstra trims FY earnings guidance on NBN

Telstra has trimmed its full-year earnings guidance range because fewer than expected customers are ready for connection on the national broadband network.

Telstra has trimmed its full-year earnings guidance range because a lower than expected number of NBN customers are available for connection.

The communications giant on Thursday said income will be $300 million lower than previously expected because the national broadband network's corporate plan includes fewer than predicted premises declared ready for service.

As a result, Telstra has trimmed its earnings guidance excluding restructuring costs to between $8.7 billion and $9.4 billion from between $8.8 billion and $9.5 billion.

However, Telstra shares were trading 10 cents, or 3.3 per cent higher, at $3.12 at 1030 AEST.

Telstra chief executive Andrew Penn wrote in a letter to shareholders in August that the rollout of the NBN has had an "enormous impact on our business".

"Wholesale prices have risen, meaning we and other industry participants are facing a fixed-line market where reseller margins are rapidly reducing," he said.

The company announced in June it would be slashing a quarter of its workforce, selling off $2 billion in assets and break off its fixed network infrastructure as a new business as part of a strategy to slash costs and improve customer experience.

The company reported a full-year-profit drop of 8.4 per cent in August to $3.56 billion.


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Source: AAP


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