Telstra Group (TLS) H2 2024 earnings summary

Executive summary

• Achieved third consecutive year of underlying growth, with strong momentum in mobile, infrastructure, and fixed consumer & small business segments.

• Underlying EBITDA rose 3.7% to $8.2b, while reported EBITDA fell 4.2% due to $715m in one-off restructuring and impairments.

• Underlying NPAT increased 7.5% to $2.3b, but reported NPAT declined 12.8% to $1.8b.

• Fully franked total dividend increased 5.9% to 18c per share, with $2b returned to shareholders.

• Continued investment in digital infrastructure, including $5b in capex and spectrum, and execution of the T25 strategy.

Financial highlights

• Total income grew 1.0% year-over-year to $23.4b underlying, $23.5b reported.

• Free cash flow after leases up 7.3% to $3.0b; net debt increased to $15.8b (1.9x underlying EBITDA).

• Underlying EPS up 5.7% to 18.5c; reported EPS at 14.1c, down 15.6%.

• Mobile services revenue up 5.6%; mobile EBITDA up over $400m, with 560,000 net new handheld customers.

• Fixed Consumer & Small Business EBITDA up 88% to $254m; ARPU up 2.8%.

Outlook and guidance

• FY25 underlying EBITDA guidance: $8.5b–$8.7b; BAU capex $3.2b–$3.4b; strategic investment capex $0.3b–$0.5b.

• Free cash flow after leases (before strategic investment) expected at $3.0b–$3.4b, including $300m restructuring outflow.

• Confident in maximizing fully franked dividends, maintaining strong credit metrics, and achieving $350m cost reduction by end of FY25.