Telecom reinvestment on hold

Telecom has suspended its dividend reinvestment plan for its first-quarter dividend, blaming uncertainty about the Government's broadband plans.

Shareholders who elected to participate in the dividend reinvestment plan will receive a cash dividend at the same time as dividends are paid to non-participating shareholders. The dividend is payable on December 3.

Telecom said that when it announced its first-quarter result and first-quarter dividend on November 5 it had expected an imminent announcement regarding the Government's ultra-fast broadband initiative, in line with Crown Fibre Holdings' expected timetable.

Delays in the announcement made it imprudent to proceed with the issue of shares under its dividend reinvestment plan for the coming quarterly dividend, or undertake the associated on-market buyback of ordinary shares. It reported net profit of $103 million in its first quarter, down from $163 million last year.

- NZPA