Telstra is retaining its grip on Australia’s mobile market and new CEO Andy Penn says he intends to keep it that way.
The challenge was issued as Telstra reported a net profit of $4.3 billion for 2015 based on sales revenues of $25.8b, up 2.9% from the last financial year, but 6.3% when adjusted to reflect the sale of Hong Kong-based CSL on the numbers.
Of that $25.8b, $10.7b was generated by mobiles, a rise of 10.2% over the last 12 months.
So mobile products now generate nearly half of Telstra’s total revenues. No wonder Penn has vowed to do whatever it takes, in terms of investment, to maintain Telstra’s current edge on its competitors in the wireless market.
Only a month ago, Penn announced a mobile spending increase of more than A$500 million over the next two years. But at the results announcement he hinted that might not be the last upgrade.
“We’re very prepared to increase it again, and do what we need to do to continue to ensure that we have mobile leadership,” he said.
Meanwhile, former CEO David Thodey almost stole the limelight from his successor despite Telstra’s solid results. Meanwhile, Telstra’s annual report reveals that ex-CEO David Thodey received a payout of $14.5 million for his last year in the driver’s seat.
Few would dispute Thodey’s success in restoring Telstra’s fortunes over his term as CEO. But more than one Telstra employee – even at executive level – must be wondering at the growing gulf between earnings at this level and the modest rewards offered to those who do the work on the ground.