An annual general meeting of TPG Telecom Limited (ASX: TPM) held on 5 December 2018 where the executive chairman presented the performance of FY2018 amongst the investors.
FY2018 was a challenging period for the company regarding profitability. The industry also got influenced as a result of NBN rollout. The chairman David Teoh believes that TPG will always try to implement its long-term strategies to build a platform for future growth. Keeping this in mind, when TPG was in a phase where it was facing challenges in the market place, the company tried to optimize cost so that the shareholder’s get maximum returns.
In this regard, the company has already taken initiatives where long-term strategies are built. The recent one is that the company has built mobile networks in Singapore and Australia. Substantial efforts have been put towards the negotiation of a good deal and regulatory approvals. The business also got merged with Vodafone Hutchison Australia (VHA).
The board feels very proud of the company’s achievement since past ten years where it has positioned itself as a leading challenger telecommunication company. The company also believes that once it gets merged with Vodafone Hutchison Australia, it be giving a tough competition to Telstra and Optus. Also, the infrastructure of the company will enable them to deliver competitive value propositions to the Australian consumes.
In FY2018, the company reported a revenue of $2,495.2 million. The EBITDA for the period was $841.1 million. The net profit after tax was reported as $396.9 million with an earning price per share worth 42.8 cps. Historically, in 10 years, the company has tried to maintain a positive growth trend in EBITDA and NPAT as well.
Also, as per the guidance report of March FY2018, the underlying EBITDA is above the upper limit. There is also a reported fall in the BAU capex as per the guidance report. The BAU capex is below the lower limit of the guidance report. Further, the company is rated no 1 for average NBN download speed by ACCC.
From the operating activities of the company, there was a net cash inflow of $673.8 million. Here, the main source of cash inflow was through the cash receipts from customers as well as cash generated from operations. Simultaneously, there was a cash outflow as well in the form of payment made to the suppliers and the employees as well as income tax paid.
From the investing activities of the company, there was a net cash outflow of $956.3 million. Here, the main source of cash outflow was due to the acquisition of spectrum asset, acquisition of property, plant and equipment and acquisition of other intangible assets.
From the financing activities of the company, there was a net cash inflow of $318.3 million. Here, the main source of cash outflow was due to the payment of finance lease liabilities, repayment of borrowings, paid interest as well as the dividend.
There was an increase in the net cash and cash equivalent worth $35.8 million. The net cash available by the end of the year was $82.2 million. At present, the market price of the share is A$7.350 with the market capitalization of A$6.82 billion.
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