Question 1

What caused the massive drop in TPG's bottom line this year?

Accepted Answer

Reported profits fell 56% to A$174mn, driven primarily by a A$236.8mn impairment charge. This write-down stems from the decision to abandon the Australian mobile network rollout following regulatory restrictions on equipment vendors.

Question 2

How is the transition to the NBN affecting profit margins?

Accepted Answer

The migration is causing significant margin compression, with consumer broadband margins declining 400 basis points to 43%. This structural shift is the primary driver behind the projected 10% decline in FY20 EBITDA guidance, which is set at A$735mn-A$750mn.

Question 3

Are there any parts of the business that are still growing?

Accepted Answer

The Corporate division is the company's primary growth engine, delivering a 48% EBITDA margin and an A$37.4mn increase in earnings. While consumer fixed voice revenues fell 38%, the corporate segment saw a 5% revenue lift in Data and Internet services.

Question 4

What is the status of the Singapore mobile launch?

Accepted Answer

Operational milestones are being met with outdoor mobile coverage reaching 99.69% as of July 2019. Market entry is gaining momentum, evidenced by nearly 300,000 trial signups for the new service.

TPG FY19 update – there’s a lot riding on the merger…

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