Chorus Limited broadband connection update for Q1 FY19

  • Oct 11, 2018 AEDT
  • Team Kalkine
Chorus Limited broadband connection update for Q1 FY19

Chorus Limited (ASX: CNU) deals in the business of telecommunication and is operating nationwide to provide fixed line access network infrastructure the New Zealand location. Infrastructure includes local telephone exchange, copper and fibre objects, basic copper, value added network services, Infrastructure and field services.

The Q1 results of Chorus Limited (ASX: CNU) show a strong growth of broadband connection in Chorus fibre area. Chorus experienced a record break uptake of 50% in ultrafast broadband connection (UFB) for new fibre installation. 

In Q1, the fixed line connection has gone down by 19000 and as such reached 1,507,000 against the drop of 17000 in the previous Q4 of FY18. The major decline in the total connection was in the zone of other fibre company. Although there was a decline in the copper line but at the same time there was a strong growth in broadband connection. The total broadband connection has gone up by 3000 connections and has reached 1,190,000 as of now. Installation of 50,000 fibre was a record as a result of strong demand for fibre in Q1. Within the region of Chorus, the UFB connection has gone up by 50% which was 45% earlier. The connection with speed of 1GBPS has gone up by 20% and reached 36,000 in terms of number of connections. The sudden upward movement in demand is 221GB monthly which is an average monthly usage of data in the month of September which was 210GB in the month of June. The data usage for fibres has gone up from 297GB and reached 307GB by September.

Chorus has given a positive performance throughout its journey. In the duration of 6 months, the company shows stock performance of 15.71%. Its YTD performance is 16.62% and within a period of 1 year the performance has gone up to 24.16 and has been 90.52% within a span of 5 years. From the inception of the company, the performance is 92.17%. For FY18, the company reported NPAT degrowth of 24.78% to $85 million while revenue from ordinary activities of $997 million was down by 5.32%. The cash flow from it operating activities was A$ 508 million and cash used in the investing activities was A$ 770 million while the cash which is being received through investing activities was A$ 142 million. Net operating cash flow saw a downturn compared to $524 million of last year; and the group declared final dividend of 13 cents, while the full year dividend amounted to 22 cents. This was still above the figure of 20.33 cents noted last year. The group has a dividend yield of 4.6% while the franking is of 0%.

Today, the CNU shares were trading at A$ 4.33 with PE Ratio of 24.10x and market cap of A$ 1.9 billion. The shares were down 2% as at October 11, 2018, 3:40 PM AEST.

The chart depicts that the moving average convergence and divergence line (MACD line) is below the signal line representing the price to be bearish in nature.

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