David Teoh, the executive chairman of TPG Telecom, is disappointed at the telco’s share price fall over the past year.
The share price, which closed at $6.03 yesterday, has halved since July last year.
“Your directors are all shareholders in the company and each of us is, of course, disappointed about the margin headwinds that the Group is facing as a result of the building of the NBN network, and the consequential decline in the Company’s share price over the past year,” he told the company’s AGM.
“However, I am confident that the strategies we are implementing will continue to create excellent value for shareholders over the long term.
When it announced its annual results in September, the company said it was anticipating another year of solid growth but this would be offset by NBN margin headwinds as revenue for fixed line rentals fades.
Teoh and his wife, Vicky, own more than one third of TPG.
The company is currently building Australia’s fourth mobile network, a $1.9 billion project, and will soon start testing in Sydney and Melbourne.
TPG in April this year won a $1.26 billion bid for spectrum in the 700MHz band at an auction by the Australian Communications and Media Authority, and plans to build a mobile network covering 80% of Australia’s population.
Shareholders were told today that mobile network planning, site selection and acquisition is already well underway in major metropolitan areas.
Implementation of initial site clusters in Sydney, Melbourne, Canberra, Adelaide and Brisbane is expected to be complete by mid-2018.
And some initial trial sites are already in the process of being installed in Sydney and Melbourne.
Australia’s aggregate mobile market is worth about $8 billion. Telstra’s market share is 54%, Optus has 29% and Vodafone 17%.
The company is also building a mobile network in Singapore.
TPG today reaffirmed 2018 guidance of EBITDA (earnings Before Interest, Taxes, Depreciation and Amortisation) between $800 million and $815 million.