TELSTRA Corporation has reported a 35.6 per cent decline in first half net profit and confirmed its outlook for sales revenue to remain flat over financial 2011.
Telstra posted a net profit of $1.194 billion for the six months to December 31, 2010, down from $1.853 billion in the prior corresponding half year.
Sales revenue declined half a per cent to $12,263 million in the first half.
Operating expenses rose by $750 million in the first half.
In the outlook for 2010/11, the telecommunication company also said it expected a high single digit percentage decline in EBITDA (earnings before interest, tax, depreciation and amortisation).
The net profit result was below market expectations of $1.36 billion, according to a median of four analysts' forecasts gathered by AAP.
EBITDA were $4.58 billion, down 13.9 per cent from a year ago.
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Market players had tipped EBITDA to decline by 12.7 per cent to $4.61 billion.
Last year, Telstra earmarked $1 billion in spending over 2010/11 in a bid to grow market share and develop new products.
To that end, the telco said today it had added 919,000 new mobile customers and 139,000 net retail broadband customers in the first half of 2010/11.
Telstra said there were 555,000 new mobile customers added in the second quarter of 2010/11.
"We recognise the need to translate this customer momentum into revenue and profitability but with customer base a leading indicator of financial performance, we believe that our strategy remains on track," Telstra said in a statement.
Telstra chief executive David Thodey said the strategy announced last August to improve customer service, increase customer numbers, simplify the business and invest in new growth business was "now bearing fruit".
Mr Thodey said the encouraging sales momentum in the first quarter of 2010/11 had continued into the second quarter.
"We are also enjoying the strongest customer momentum in over a decade, and revenue growth across our three retail segments with costs in line with our expectations," Mr Thodey said in the statement.
Fixed line revenue declined by 8.4 per cent to $2.743 billion, a slight improvement from the nine per cent fall in the second half of 2009/10, Telstra said.
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