TelstraClear shrugs off recession with strong result

New Zealanders are still spending up on broadband despite the tougher economic climate, says the local arm of Australia's biggest telephone company.

Reporting its results yesterday, TelstraClear said its consumer business had been the revenue growth engine for the company.

TelstraClear chief executive Allan Freeth said consumers were prepared to make cuts elsewhere in the household budget in order to retain internet access.

"We've observed a significant shift in the market in the last year. Consumers have continued to embrace broadband despite the economic recession and buying more of it, not less of it," said Freeth.

Chief financial officer Michael Boggs said consumer revenues were up almost 20 per cent year-on-year, consistent with the previous year.

On its own network in Christchurch and Wellington growth had been 17 per cent, with growth up 22 per cent where the company is re-selling broadband access, said Boggs.

Overall revenue for the year to June 30, 2009, has grown nearly 3 per cent to $703 million, with ebitda up 7 per cent to $159 million. Ebit improved 142 per cent to $18 million from $7.5 million the previous year.

Freeth said a focus on costs and its advertising had pushed, in particular, the broadband growth numbers and its best operational result yet.

Freeth said the focus for the coming year would be on local loop unbundling in Auckland and several provincial towns, its 3G mobile offer through a tie-up with Vodafone, a 100 megabit per second service on its own fibre network in Wellington and Christchurch, plus a PVR product to rival MySky over the same network.

TelstraClear's Australian parent, Telstra, posted its biggest annual profit in four years, growing net profit 10 per cent to A$4.1 billion ($5.1 billion).

The company experienced strong revenue growth in its mobile and broadband offers - up nearly 10 per cent and 15 per cent respectively - offsetting a slowdown in voice calling revenue.

High-end smart phones helped drive up mobile data sales by 31 per cent.

Chief executive David Thodey said the company was well positioned to face the challenges of the year ahead. Telstra shares fell 5c to A$3.56 on the ASX yesterday.