On December 24, 2018, Vocus Group Limited, telecom giant, announced that they are going to implement renegotiation and a five-year extension of its current MVNO agreement (Mobile Virtual Network Operator) with Optus Wholesale and due to this agreement, the company can also access the Optus 5G network and future technologies.
The long-term partnership agreement is designed to drive growth for both the businesses, this agreement will further provide a platform for Vocus to expand its mobile customer base across its various brands.
Also, it will comfort the path for Vocus limited to enter future 5G mobile services. Due to this, Vocus can soar its market share in Enterprise and Small to Medium Business Segments.
As stated by Vocus Group’s Managing Director and CEO Kevin Russell, their new partners Optus will gives Vocus access to market-leading future technologies as well as also provides the flexibility to put attractive mobile propositions in a market promptly. They have a high degree of confidence in Optus leadership in 5G networks and their potential to innovate and better cater to their customers in mobile, and they had a historically sub-scale market share. It also enables their consumer resale business to rebalance its economics away from a complex and increasingly costly NBN wholesale broadband model to more sustainable and commercial margins in mobile.
John Castro Managing Director of Optus Wholesale and Satellite also stated that they are also glad to extend their long-term partnership with Vocus. Optus will further work with Vocus as they deploy 5G services domestically. Due to this agreement Optus will get around $200 million over the total duration of the five-year agreement.
The company has also announced the change of auditor to PricewaterhouseCoopers (PWC) from Deloitte Touche Tohmatsu (Deloitte). The company selected PwC based on their reputation and experience, particularly with similarly sized companies to Vocus in the telecommunications industry. This will be effective from the date of this announcement for the financial year commencing 1 July 2018 and subsequent financial years.
FY18 Financial Performance: The company generated EBITDA of $366.1 million in 2018, representing an upside of 6.8% over the $342.6 million recorded in the corresponding period in 2017. The Group’s net profit after tax for the year stood at $127.1 million. The company generated Revenue of $1898.2 million in 2018, representing an upside of 4.3% over the $1820.6 million recorded in the corresponding period in 2017.The company generated Underlying EBIT of $224.8 million in 2018, representing a downside of 13.6% over the $260.2 million recorded in the corresponding period in 2017. The company’s Fully Diluted Underlying EPS of $20.4 in 2018, representing a downside of 17.40% over the $24.7 recorded in the corresponding period in 2017.
Stock performance: In the last six months, the share price of the company has shown a positive return of 22.40 percent as on 21 December 2018 and 7.27 percent down over the past one month. Vocus Group Limited shares are trading at $2.990 with a market capitalization of $1.9 Billion with the close of trading hours on 24 December 2018.
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