A flick through FY22 of ASX listed telecom player Aussie Broadband (ASX:ABB)

By - Aditi Sarkar

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Highlights

  • The stock value of ABB has gained about 33% in the last 30 days and 14% this quarter to date.
  • The company acquired Over the Wire (OTW), a telecommunications and IT services provider, and is delivering AU$5.2 million of annualised synergies.
  • The company is looking forward to revenue in the range of AU$800million to AU$840million in FY23.

Shares of Aussie Broadband Limited (ASX:ABB) closed on Friday at AU$2.630 with an uptick of about 5.2%. The Australia-based telecommunications and technology company has gained nearly 33% in the last 30 days and 14% this quarter to date.

Aussie is the 5th largest provider of broadband services in the country and boasts of being one of the only six tier 1 voice providers in the nation.

The company’s key financial metrics have also significantly improved over time. Since June 2018, the company’s total revenue has surged by around 1009.33% from AU$49.3 million to AU$546.9 million. Similarly, its gross profit has surged by nearly 1394.44%.

Below are the key financial metrics and strategic achievements of the company for FY22

  1. Revenue of AU$546.9million – Up by 56%
  2. EBITDA before transaction costs of AU$39.4 million – Up by 107%
  3. Business revenue of AU$105.5 million – Up by 142%
  4. Acquired Over the Wire (OTW) and delivering AU$5.2 million of annualised synergies
  5. Launched its white-label solution and onboarded more than 58,000 broadband connections (services)
  6. Expanded its offering to different segments with cloud, managed services, security and expanded voice solutions
  7. Upped its software automation, which helped them with a lower staff touch and keeping operations onshore
  8. Completed the roll out of the Fibre network to the 83 NBN POIs, 22 data centres and 77 multi-storey buildings, unlocking considerable operation savings
  9. Improved its network infrastructure by means of upgrades to core network equipment, enabling the company to zoom past the mark of 1 million broadband services

FY23 guidance and strategic focus

Considering the current market conditions, operating plan and YTD trading, the company is hoping for revenue in the AU$800million - AU$840million range. It is expecting an EBITDA margin (integration costs not included) of c10-10.5%, up from 7.2% in FY22.

Going forward, below are some strategic focuses of the company for FY23:

  1. Bed down its new Aussie 2.0 operating model, team structure and strategy
  2. Tapping the full revenue synergy potential from OTW acquisition by delivering more cost synergies
  3. Continued investment in data, voice, and cloud infrastructure in a bid to support long-term growth
  4. Refreshing its marketing strategy to improve growth in all segments and enhance its advertising efficiency
  5. Development and launch of new products and services to retain its game changer image
  6. Crank up automation and streamlining of processes to use their scale to the fullest potential and unlock novel operational efficiencies.