- Record statutory net revenue of $577.6 million, up 76.8%.
- Revenue from mobile phone sales fell but energy sales now make 54% of revenue.
- No dividends in the short to medium term.
Maverick telco Amaysim cancelled dividends as full year profit fell 76% to $2.71 million, with revenue from its mobile phone business sliding and margins squeezed on broadband internet sales.
However, the mobile phone and broadband player picked up revenue from Amaysim Energy, trading as Click Energy, selling power to consumers.
Overall revenue was 76.8% higher at $577.63 million with 54% of that coming from energy.
The mobile sim card company last year launched itself as a energy utility with no lock-in contracts and discounts which don’t expire, buying Click Energy, an online pure-play energy seller, for $120 million.
The bigger telcos also are reporting intense competition in the mobile market, dragging down the value of each customer. Telstra earlier this month report a flat result for mobile, with revenue rising just 0.4%.
“Our diversification into energy has enabled amaysim to deliver growth despite a challenging mobile market,” says Amaysim CEO Peter O’Connell.
“The early success of Amaysim energy reinforces our belief that our cross-sell offering will differentiate the company in a crowded telco market.”
The energy business delivered revenue of $310 million. Subscribers grew by 15.9% to 191,000
The broadband business had 15,000 subscribers, delivering revenue of $8.6 million and an underlying EBITDA loss of $6.3 million.
In the second half of the 2018 financial year, the company made the decision to reduce investment in broadband as intense competition and high wholesale costs put pressure on already low margins.
The mobile business grew subscribers by 7.8% to 1.158 million but net revenue was down 7% to $259 million as the amount of revenue collected from each customer fell.
O’Connell says he expects competition in mobile to remain intense in 2019.
“We are still confident about the sector over the medium to long-term,” he says.
“We continue to achieve strong mobile subscriber growth in July 2018 and expect the roll out of 4.5G and 5G networks in Australia over FY19 and FY20 to provide increased rationality and a slowing of competitive excess.
“Notwithstanding the difficult market, the company is actively reshaping itself to access new services, when ready, by developing our technology platforms to deploy additional services quickly; improving our analytics and marketing capability to attract and serve customers; increasing cross-sell of mobile and energy; and elevating our marketing capabilities.
“We are focused on delivering strong value by growing awareness of amaysim as a utilities service provider to increase cross-sell of energy to our mobile subscriber base. We intend to push hard on this strategy to achieve profitable growth.’
The company held back dividends.
“The board holds the view that it is in the interests of shareholders for the company to retain a greater proportion of profits in the business and has made the decision not to declare a dividend for the 2018 financial year,” the company said.
“The board expects this approach to continue for the short to medium term.”
The 2018 results by segment: