The recently reported results for the half-year 2023-24 indicated that escalated interest rates contributed to this financial setback. NBN Co unveiled on Thursday that its revenue for the period surged by 5% to reach $2.75 billion.
Despite the revenue increase, a crucial performance indicator, the average revenue per user, remained stagnant at $47. This figure, initially achieved in 2022, has displayed no growth since then, highlighting a persistent challenge for the company.
Chief executive Stephen Rue said he was pleased that key financial and operational performance metrics were on track to meet full- year guidance.
“The biggest milestone for the half-year was gaining ACCC acceptance for our Special Access Undertaking Variation,” said Rue
“This landmark outcome follows two years of detailed consultation, which delivers a new approach to wholesale pricing, supports faster internet speeds, greater data demand and improved cost certainty for retailers and customers. Importantly, the SAU provides long-term regulatory predictability,”
“The new Wholesale Broadband Agreement came into effect on 1 December 2023, with significant reductions in the wholesale prices of entry level and higher speed tiers,”
“We are pleased to see Retail Service Providers already promoting the benefits that customers can derive from NBN Co’s new wholesale plans,”
“We continue to deliver our network upgrade programs on time, on budget and for the community’s benefit,”
“We closed the half-year with more than 8.4 million premises, or 75% of the Fixed Line network, eligible to access the NBN Home Ultrafast speed tier, a remarkable outcome which means these customers can now gain access to peak wholesale download speeds of 500 Mbps to close to 1 Gbps,” he said.
“Almost 200,000 Australian premises have chosen to upgrade to an NBN full-fibre service, which has been made possible by our network investment strategy,”
“This demonstrates customers’ strong appetite for high-speed Internet amid the consumption of increasing volumes of data, and the NBN network remains best placed to deliver such speed and capacity at scale.”
According to Ian Chitterer, vice-president, Moody’s Investors Service NBN Co’s results for the first half of fiscal 2024 were marginally above our expectations with EBITDA growth of 10%.
“We expect a slight improvement in NBN Co’s credit profile over the next 12 to 18 months as increasing EBITDA and operating cash flow are offset by high levels of capital spending to improve the network.
“NBN Co’s available liquidity of $7.3 billion is a credit positive, as it alleviates refinancing risk related to the $5.5 billion outstanding under its Commonwealth loan maturing on 30 June 2024.”
The announcement of NBN Co’s half-year loss of $696 million underscores the ongoing financial challenges faced by the company in its mission to roll out Australia’s national broadband network
Factors such as increased interest rates have contributed to this setback, highlighting the complexities involved in managing such a large-scale infrastructure project.
While there has been a modest increase in revenue, the stagnation of the average revenue per user metric indicates the need for continued strategic efforts to improve financial performance and ensure the long-term sustainability of the network.
