Why Chorus’ shares were in high spirits today

Highlights

• Chorus delivered a power packed HY22 performance.
• Its big fibre boost was the largest-ever performance upgrade for fibre customers.
• It will pay 14.0 cps as an interim dividend and has also provided dividend guidance for FY23 and FY24.

Chorus Limited (NZX:CNU; ASX:CNU) today released its HY22 results, highlighting its strong first-half financial performance, despite being impacted by COVID-19-related disruptions.

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Impressive performance by CNU

Its NPAT rose to NZ$42 million, and EBITDA was recorded at NZ$347 million for the period, underpinned by continued broadband growth in the company’s fibre areas.

Further, the telecom company's operating revenues climbed at NZ$483 million, majorly on account of gains from its ongoing network optimisation programme.

Must Read: Why look at 3 NZX communications stocks in 2022?

Fibre uptake on the rise

In December 2021, CNU upgraded over 600,000 homes and businesses on fibre to improved speeds, which was the Company’s largest-ever performance upgrade for its fibre customers.

In other words, now residential customers with a 100 Mbps fibre plan can have access to 300 Mbps, while there was a five-fold increase in upload speed, which rose from 20 Mbps to 100 Mbps.

It is noted that CNU’s fibre connections jumped from 47,000 to 918,000 during the six months ended 31 December 2021, and the Company is on track to achieve its target of one million fibre connections by the end of 2022.

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Gives guidance for FY22, FY23 and FY24

Bolstered by its power-packed performance, Chorus will reward its shareholders by paying an interim dividend of 14.0 cps.

The said dividend will be paid on 12 April. Also, since a dividend reinvestment plan is available, applications are invited from those shareholders who wish to increase their shareholding instead of receiving a cash dividend.

Further, Chorus has raised its FY22 EBITDA guidance from NZ$665 million to NZ$685 million and also aims to increase its dividend guidance to 35.0 cents from 26.0 cents.

Moreover, the Company has provided minimum dividend guidance of 40.0 cps and 45.0 cps for FY23 and FY24, respectively.

Announces share buyback

CNU has also notified its shareholders regarding its share buyback programme of up to NZ$150 million. The said programme will commence on 25 February 2022 and might run for up to 12 months from today.

Shares thus bought would be cancelled upon the acquisition, thus reducing the number of shares on issue.

This will help boost the Company’s future earnings per share as well as imputation credit reserves.

Bottom Line

Chorus Limited is constantly focused on enhancing its customer experiences and is on track to deliver its targeted fibre connections by the year-end.

At the closing bell, CNU jumped by 8.74% at NZ$7.340, on 21 February.