The Telstra Corporation Ltd (ASX: TLS) share price is edging higher on Tuesday.
In morning trade, the telco giant's shares are up 0.5% to $3.84.
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Why is the Telstra share price edging higher?
The Telstra share price is on the move on Tuesday after the company released its annual general meeting presentation ahead of the event.
That presentation includes a trading update, which reveals that Telstra has started the year positively.
According to the release, Telstra's new CEO, Vicki Brady, has confirmed Telstra's guidance for FY 2023. Telstra continues to expect:
- Total income of $23bn to $25bn ($22bn in FY 2022)
- Underlying EBITDA of $7.8bn to $8bn ($7.3bn in FY 2022)
- Capex of $3.5bn to $3.7bn ($3bn in FY 2022)
- Free cash flow of $2.6bn to $3.1bn ($4bn in FY 2022)
Brady commented:
Guidance across all measures includes our Digicel Pacific acquisition that completed in July. Our Underlying EBITDA guidance is consistent with our previous FY23 ambition, plus a contribution from Digicel Pacific.
Our Capex guidance includes an uplift in mobile investment, around $150m for Digicel Pacific, and around $350m of strategic investment outside of BAU for the inter-city fibre and Viasat infrastructure projects. Finally on guidance, we expect to continue to achieve strong cash flow, enabling us to invest for growth and deliver returns to shareholders.
Optus cyberattack
Telstra's chair, John Mullen, spoke briefly about the Optus cyberattack and the growing threat facing all companies. He said:
Vicki will touch further on cyber-security shortly, but may I just say that it is easy for third parties to be critical of companies who have suffered devastating cyber-attacks such as happened recently to Optus.
Let me be blunt, however, and say that it is easy to be critical when it isn't you in the firing line, and we should all avoid hubris because no-one can be complacent and no organisation can ever be 100% sure that it is completely protected and safe.
The threat and sophistication of the attackers grows every day, and to address the threat business needs to put aside competitive rivalry, and work constructively across industries, with government, and with the community to protect Australia from this modern scourge.
Scheme meeting
It is also worth noting that Telstra will also be holding its scheme meeting today. This will see shareholders vote on the restructure of the company, which is a key component of the T25 strategy.
If shareholders approve the restructure, it will see the establishment of Telstra Group Limited as the head entity of the Telstra group. InfraCo Fixed (physical network infrastructure assets), InfraCo Towers (physical mobile tower assets), ServeCo (customer service and products), and Telstra International will then be below it.
After which, Telstra will consider selling some of its assets or demerging them into separate ASX listings to unlock value for shareholders. The latter is being seen as the likely option for the InfraCo Fixed business.
