TPG sees net profit soar 90 per cent in first half FY16

EBITDA increased 85 per cent to $437.3 million

ASX-listed TPG Telecom has seen its net profit soar 90 per cent to $202.5 million for the first half of FY16, ending January 31. This is in comparison to the same time last year.

EBITDA increased 85 per cent to $437.3 million and earnings per share increased 83 per cent to 24.5 cents per share.

The acquisition of iiNet has contributed EBITDA of $107.1 million for the five and a quarter months post acquisition, inclusive of $4 million in restructuring costs that derived from integration activities. iiNet’s underlying EBITDA for the first half of FY15 was $97 million.

According to TPG, some of the factors that contributed towards EBITDA growth were the post-acquisition integration benefits, three months of lower access costs arising from ACCC’s fixed access determination and an increased contribution from Tech2.

iiNet’s total broadband subscribers on January 31 were 989,000.

The TPG Consumer Division’s EBITDA was $125.6 million compared to $117 million in the first half of FY15. This was due to the telco experiencing organic broadband subscriber growth, which was up 32,000 in the half-year. As of January, TPG’s consumer division had 853,000 broadband subscribers and 297,000 mobile subscribers.

TPG’s corporate division EBITDA was $131.9 million, up from $117.7 million at the same time last year.

In July last year, iiNet shareholders (95 per cent) voted in favour of TPG’s $1.56 billion takeover offer.

At the time, iiNet chairman, Michael Smith, said the telecommunications sector was heading towards an inevitable consolidation phase.

"It's clear we have built a business with a brand, customer base and reputation for customer service that a number of key players in the industry would like to own," Smith said.

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