Key developments

Telco stocks in Australia and New Zealand have seen wide spreads in performance over the last 12 months. Economic growth is expected to remain sluggish relative to previous years, creating uncertain performance for telco equities.

Megaport

Megaport’s stock retreated over 22% during the last month, with investors reacting unfavourably to its full year FY24 results despite the company recording 28% YoY revenue growth from $195.3m of revenue and 182% YoY EBITDA growth from $57.1m of EBITDA. The share price slide has been attributed to the unsatisfactory FY25 guidance provided in the results release, with Megaport anticipating revenue in the range of $214-222m and EBITDA in the range of $57-65m for the FY25 financial year.

Spark New Zealand

Spark New Zealand shares declined over 17% during the last month, with the company releasing poor full year FY24 results including -14% YoY revenue growth from NZ$3.86b of revenue and -32.5% YoY EBITDAI growth from NZ$1.163b of EBITDAI. Spark New Zealand also released FY25 guidance, with the company anticipating EBITDAI in the range of NZ$1.165-1.220b and Capex in the range of NZ$460-480m for the current financial year.

Superloop

In the last month Superloop’s stock has risen 10% with the company releasing favourable full year FY24 results, which included 30% YoY revenue growth from $420.5m of revenue and 45% YoY EBITDA growth from $54.3m of EBITDA. The company’s CEO, Paul Tyler, pointed to wholesale service contracts won with Origin Energy and AGL being a driver for performance, and to growing consumer numbers (87,000 net new customer additions during the year).

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