AAPT dents NZ parent’s profits
Staff cut by 25 per cent
Posted in Financial News, 13th February 2011 21:56 GMT
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Telecom New Zealand’s revenue-hemorrhaging Australian arm, AAPT, has managed to shed a quarter of its staff in the last six months, but still found ways to negatively impact its parent’s bottom line.
Despite selling the consumer division of the business to rival iiNet for $60m last year, adjusted operating revenues decreased by $83m to $375m in H1 FY11 as revenue declined in all categories.
The divestment of the consumer division, which predominantly affected calling, broadband and internet and resale revenues, resulted in $42m of the revenue decline. However falls in revenue were experienced across all divisions including Business Solutions and Wholesale.
Labour costs decreased by $11m to $59m when compared to the previous half due to the sale and a wider restructuring process.
At the time of the transaction it was reported that around 50 staff were to be transitioned to iiNet however at total 303 fulltime and contract staff have been eliminated in the half year period.
“We have successfully divested the Consumer business from AAPT and completed the sale process, and the Wholesale and Business divisions continue their strong sales performance,” said Paul Broad, CEO, AAPT.
“Our focus remains on creating a simpler, leaner business structure, including the imminent completion of our billing rationalisation programme,” he added.
AAPT’s EBITDA declined by $18m to $38m when comparing the previous corresponding period.
Overall TNZ reported a net profit after tax of NZ$158m, a decline of 35 per cent, while EBITDA fell 0.5 per cent to $868m for the period.
Meanwhile iiNet announced that it had made an undefined number of staff redundant this week a result of their aggressive growth by acquisition strategy. Industry speculation suggests the number is around 60.
A spokesman for the ISP said “as a result of our rapid growth and recent acquisitions, it is only natural that the staff structure is reviewed. Following this review, a small number of staff, mainly in head office functions, and across the iiNet group have been offered a redundancy.” ®
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