Telstra has been forced to adjust its outlook for the current financial year after NBN Co revealed the number of connections had been lower than anticipated.
NBN Co released its corporate plan for 2020 on Friday 30 August which updated its expected performance for the coming year. Chief among those updates was that the number of premises expected to be connect in FY20 had been lowered from 2 million to 1.5 million.
Telstra’s guidance, released on 15 August alongside its FY19 results, was predicated on NBN Co’s previous FY19 corporate plan. As a result, Telstra lowered its expected revenue forecast for FY20 by $400 million, which is now projected to be in the range of $25.3 – 27.3 billion.
The company now expects the peak of its NBN headwinds to be pushed back from FY20 to FY21, meaning EBITDA is projected to be $100 million more than initially thought, now in the range of $7.4 – 7.9 billion. NBN headwinds in FY20 are expected to be in the range of $600 – 800 million, down from $800 million – $1 billion.
Telstra has been trying to claw back as much earnings as it can in the wake of the NBN’s completion, expected sometime in FY20. So far, Telstra estimates the NBN has missed out on $1.7 billion in EBITDA since FY16 as a result of the NBN.
NBN Co’s FY20 corporate plan also projected average revenue per user (ARPU) for residential customers at $49 by FY23. For the first time, NBN split its revenue forecasts into residential and business users, opting to no longer break out ARPU figures for business customers “as we do not believe it is meaningful on a per-premises basis,” according to NBN Co chief executive Stephen Rue.