The Aussie Broadband Ltd (ASX: ABB) share price is on the rise this morning after the ASX 200 telecommunications provider reported its half-year earnings for the six months ending 31 December 2021 (1H22) today before market open.
Aussie Broadband shares opened at $4.49 this Monday after closing at $4.50 last week, and are going for $4.60 each at the time of writing, up 2.22%.
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Aussie Broadband share price rises on solid first-half update
- Revenue up 46% from $157.4 million in 1H21 to $229.3 million in 1H22
- Earnings before interest, tax, depreciation and amortisation (EBITDA) up 7% from $8.5 million in 1H21 to $9.1 million for 1H22.
- Gross margins up 1% to 27%.
- Net profit after tax (NPAT) of $1.4 million, up substantially from the net loss of $10.5 million in 1H21.
- Total broadband services up by 45% to 494,803
What else happened in the first half?
Aussie Broadband managed to increase its market footprint substantially over the half year. The increase in broadband services helped push Aussie Broadband's NBN market share to 5.66% from 4.23% in December 2020. The company also managed to increase the number of mobile services by 70% to 32,207 over the half. Business broadband services also rose, increasing by 67% to 45,483.
The company also highlighted its successful $134 million capital raise. Conducted in September last year, this saw the Aussie Broadband share price rise at the time.
What did management say?
Here's some of what Aussie Broadband managing director Phill Britt had to say on the results:
It's been another year of growth for Aussie, and I am extremely proud of the work the whole team has put in to create some great half-year results…
The year started with a huge amount of uncertainty due to the ongoing effects of the COVID-19 pandemic, but our growth in broadband services, for both residential and business segments, remained consistently strong.
We continued the fibre roll out with 63 sites complete at 31 December 2021; the remainder of the sites will be connected by end of FY22 when 1200km of Aussie fibre will be in the ground.
What's next?
Looking forward, Aussie Broadband has given us an outlook and guidance. For one, it is expected that Aussie Broadband's takeover of Over the Wire Holdings Ltd (ASX: OTW) will be completed following Federal Court approval in March 2022. The company has also announced that it is expecting full-year EBITDA for FY2022 to be in the range of $27 million to $30 million. That's "before transaction costs and excluding any contribution from OTW".
This performance is "expected to be driven by employee and administration costs being lower as a percentage of revenue, as well as continued growth in connections and services, and the completion of the white label migrations". "Comparable marketing costs, lower promotional costs, and the benefit of a full half of revenue from 1H FY22 acquired customers" will also help.
Aussie Broadband is also anticipating broadband net additions of 85,000 to 95,000 for the second half of the 2022 financial year. That would bring its total broadband connections to between 580,000 and 590,000 by 30 June 2022.
Aussie Broadband share price snapshot
Although the Aussie Broadband shares have had a rough start to 2022 (still down by 4%), the company remains up a pleasing 70% over the past 12 months. Its gains since first listing in October 2020 now stand at almost 140%.
At the current Aussie Broadband share price, this company has a market capitalisation of $1.02 billion.
