Telstra Group (TLS) H2 2024 earnings summary

Executive summary

• Achieved third consecutive year of underlying growth, with strong momentum in mobile and infrastructure segments, but underperformance in enterprise business led to a strategic reset and cost actions.

• Underlying EBITDA rose 3.7% to AUD 8.2 billion, while underlying net profit after tax increased 7.5% to AUD 2.3 billion; reported results impacted by AUD 715 million in one-off costs.

• Dividend per share increased 5.9% to AUD 0.18, with a payout ratio of 97% of underlying earnings.

• T25 strategy execution remains on track, with improvements in customer experience and digital transformation.

Financial highlights

• Total income grew 1.0% year-over-year to AUD 23.4 billion.

• Underlying EBITDA: AUD 8.2 billion (+3.7% YoY); reported EBITDA: AUD 7.5 billion (-4.2% YoY) due to one-off costs.

• Underlying net profit after tax: AUD 2.3 billion (+7.5% YoY); reported net profit after tax: AUD 1.8 billion (-12.8% YoY).

• Earnings per share: AUD 0.185 (+5.7% YoY); total dividend: AUD 0.18 per share (+5.9% YoY).

• Free cash flow after leases: AUD 3 billion (+7.3% YoY); net debt: AUD 15.8 billion, stable at 1.9x underlying EBITDA.

Outlook and guidance

• FY25 underlying EBITDA guidance tightened to AUD 8.5–8.7 billion, reflecting confidence in continued growth.

• Business as usual capital expenditure (including Digicel Pacific): AUD 3.2–3.4 billion; strategic investment: AUD 0.3–0.5 billion.

• Free cash flow before strategic investment expected at AUD 3–3.4 billion, including AUD 300 million cash outflow for FY 2024 restructuring.

• Confident in maximizing fully franked dividends and achieving AUD 350 million cost reduction by end of FY25.