Telstra Group Limited Adr ((TLGPY)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Telstra Group Limited’s recent earnings call painted a positive picture of the company’s financial health and strategic direction. The discussion highlighted robust financial performance and strategic investments in AI and 5G, despite acknowledging some challenges in specific segments. The overall sentiment was optimistic, with the company’s achievements overshadowing the issues faced.
Strong Financial Performance
Telstra reported its fourth consecutive year of first-half underlying growth, with an impressive 6% increase in EBITDA to $4.2 billion. The company’s profit rose by 7.1% to $1.1 billion, while earnings per share also saw a 6% rise to $0.089. This solid financial foundation demonstrates the company’s resilience and capability to sustain growth.
Increased Dividends and Share Buyback
The Board announced a fully franked interim dividend of $0.095 per share, a 5.6% increase from the previous period, alongside an on-market share buyback plan of up to $750 million. These shareholder returns reflect Telstra’s strong fiscal discipline and confidence in its financial stability.
Growth Across Segments
All business segments, including Mobiles, InfraCo Fixed, Fixed C&SB, Fixed Enterprise, and International, reported EBITDA growth. Notably, the mobiles segment increased by $92 million and InfraCo Fixed by $58 million, showcasing Telstra’s broad-based growth strategy.
Joint Venture with Accenture
Telstra’s collaboration with Accenture is set to boost its AI capabilities, aligning with its goals to enhance customer experience and network leadership. This venture underscores Telstra’s commitment to leveraging technology for strategic advantage.
Expansion of 5G Network
Telstra has expanded its 5G network to cover 91% of the population, with plans to reach 95% by the end of FY ’25. This expansion represents a critical step in maintaining its leadership in network infrastructure and meeting growing consumer demand.
Fixed Enterprise Challenges
Challenges in the Fixed Enterprise segment, particularly with Data and Connectivity (DAC), continue to impact performance. Structural changes in the industry are contributing to these hurdles, requiring strategic adjustments from Telstra.
Digicel Pacific Operating Environment
Operating in a challenging environment, Digicel Pacific’s EBITDA was down 3% in constant currency, excluding a provision release. Telstra remains focused on addressing these external pressures to stabilize the segment.
Cost Pressures and Delays in Intercity Fiber
The Intercity Fiber project is experiencing delays and cost pressures due to land access and inflation. However, Telstra is committed to adhering to its $1.6 billion budget, demonstrating fiscal responsibility.
Forward-Looking Guidance
Looking ahead, Telstra is maintaining its current outlook for the fiscal year ending June 2025, despite strong results in the first half. The company is focused on growth in underlying EBITDA, EPS, and ROIC, while addressing cost pressures and project delays. The T25 strategy remains central to its forward path, emphasizing disciplined capital management and strategic growth.
In conclusion, Telstra Group Limited’s earnings call conveyed a strong sense of optimism, driven by solid financial performance and strategic initiatives. While challenges persist in certain areas, the company’s commitment to growth and disciplined management underscores its positive momentum and future prospects.