TPG Telecom has reported a 4.6 per cent drop in full-year profit to $396.9 million after the NBN hit broadband margins and home phone revenue.
Earnings for the 12 months to July 31 slipped 5.6 per cent per cent to $841.1 million, although underlying earnings were up 0.7 per cent since the previous year was boosted by the sale of investments.
TPG flagged further profit headwinds from the national broadband network in the current financial year, when it expects to complete its $15 billion merger with Vodafone Australia - subject to competition watchdog approval.
The the pair have also committing to a separate joint bid for 5G mobile spectrum at a government auction in November.
TPG executive chairman David Teoh said the impact of the NBN on full-year profit was in line with, or slightly lower than, expected.
Chief financial officer Stephen Banfield said on Tuesday the ongoing merger of DSL subscribers had eroded earnings by $43 million for the year, 14 per cent - or $7 million - less than was forecast.
Another $50 million hit to earnings is predicted in FY19 as the company passes the halfway point of transition to the NBN, with 940,000 subscribers left to migrate off DSL.
Elsewhere, Mr Teoh highlighted "pleasing" $72 million growth in earnings from the telco's corporate segment, as well as fibre-to-the-building services and cost savings from the ongoing integration of the iiNet business acquired in 2015.
He said FY18 marked the 10th consecutive year of underlying revenue growth for the group.
A final, fully franked dividend of 2.0 cents has been declared - unchanged from last year - payable to shareholders on November 20.
TPG stocks were $8.70 a share at 1330 AEST on Tuesday, up more than 60 per cent from $5.22 the same time last year.
TPG PROFIT DOWN, BUT UNDERLYING EARNINGS UP
* Net profit down 4.6pct to $396.9m
* Revenue down 5.6pct to $841.1m
* Final dividend flat at 2.0 cents per share, fully franked
Share
