(Reuters) -Top Australian telco Telstra (OTC:TLGPY ) said annual profit sank 13% as it wrote down the value of its fixed-line enterprise unit and counted the cost of laying off up to 2,800 employees, but it flagged higher earnings in the year ahead, sending shares up.
Telstra shares rose 2.7% to A$3.975 as at 0148 GMT to hit their highest level in six months, while the broader Australian benchmark index was largely unchanged.
The firm, which reported a 3.7% rise in underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) to A$8.2 billion ($5.42 billion) for the 12 months ended June 30, lifted the bottom end of its guidance range for the current 2025 financial year.
It now expects underlying EBITDA to rise to between A$8.5 billion and A$8.7 billion, up from a previous range of between A$8.4 billion and A$8.7 billion.
For the 2024 financial year, its net profit of A$1.8 billion was hit by a one-off impairment of A$715 million owing to cost reduction measures it undertook earlier this year, particularly in its enterprise business that serves government and large companies.
The fixed enterprise segment, which provides tech solutions, network capacity and cloud services, continued to struggle amid heightened competition and constrained customer spending.
Underlying net profit after tax, however, rose 7.5% to A$2.3 billion, meeting analyst expectations, helped by strong earnings growth in its mobile business on the back of increased pricing and strong customer demand.
The company's mobile revenue grew 4.5% to A$10.72 billion contributing to about 41% of the company's total sales. Its infrastructure and consumer and small business segments also posted gains.
Telstra also announced a final dividend of 9 Australian cents per share, higher than the 8.5 cents declared a year ago.
($1 = 1.5138 Australian dollars)
Source: Investing.com