Aussie Broadband Ltd. - AGM Presentations (ABB-AU)
Aussie Broadband Ltd. - AGM Presentations (ABB-AU)
Aussie Broadband Ltd. - AGM Presentations (ABB-AU)
ASX Announcement
21 October 2022
Aussie Broadband Limited (ASX:ABB) provides the attached presentations of the Chair, Managing
Director and Chief Financial Officer, which will be delivered today at the Aussie Broadband Annual
General Meeting.
Adrian Fitzpatrick Richard Dammery Vicky Papachristos Patrick Green Phillip Britt Michael Omeros
Independent Chair & Independent Non-Exec Independent Non-Exec Independent Non- Managing Executive
Non-Exec Director Director & Chair of People Director & Chair of Risk & Exec Director Director Director
& Community Committee Audit Committee
Experienced director, Independent Advisor Experienced Extensive sales, Highly experienced Has over 20 years
currently a director of and Experienced company director, marketing, financial executive with over of experience in the
ARB Corporation. director currently currently a director of and management 25 years in the telecommunications
Extensive operational, serving on the boards Big River Industries and experience. Owned telecommunications and IT services
financial of Australia Post, GMHBA. Executive retail businesses since industry. Awarded sector. Founder and
management and WiseTech Global, experience in 1987 and won the ACOMMS the Managing
strategic experience Doctor Care marketing and Franchisee of Year Communications Director of Over The
from a career that Anywhere, Nexus business development awards both state and Ambassador in 2020 Wire Holdings prior to
has spanned 30 years Hospitals and Creative with over 30 years' nationally. and is an inductee its acquisition by the
Partnerships Australia. experience both in into the telco Company
Australia and across Industry Edisons
the USA. Awards Hall of fame.
Chair’s address
Adrian Fitzpatrick
Chair of the Board,
and today’s Annual General Meeting
Aussie Broadband Annual General Meeting – 21 October 2022
Chairman’s Address
The completion of another successful year for Aussie comes off the back of the hard work
the team has put in to ensure strong results were delivered in FY22, while completing the
acquisition of Over the Wire and positioning our Company for a substantial increase in
earnings expected this financial year.
Aussie has come a long way from our early days as a residential internet service provider in
regional Victoria. Today we provide a complete communications and technology solution
across multiple sectors and geographies.
Aussie continued its rapid growth in business and residential segments in FY22. Residential
broadband revenue increased 36% with EBITDA up 39%, whilst the business segment grew
revenue by 54% and EBITDA by 62%.
The integration of Over the Wire has been progressing as planned, bolstering Aussie
Broadband’s business segment product skills and capability. Our new operating structure
revolves around one team, one budget and one big ambition: to become the 4th largest
provider of communications and technology solutions in Australia. We are excited by the
future growth opportunities we see for our combined businesses.
Aussie has maintained its market-leading service reputation, reflected in the multiple awards
received during the year and also retained a high customer satisfaction score of 8.1/10. We
believe our ability to deliver strong customer support and a superior high speed tier product
will continue to support low levels of churn going forward.
Over FY22 we also developed new capabilities to provide wholesale and white-label
broadband and voice services. We see significant opportunity in providing end-to-end
support for third parties with large existing customer bases. This new segment grew to
include approximately 60,000 white label connections in 12 months and generated $26.4
million in revenue and $1.5 million in EBITDA over the last 12 months.
Our rapid growth across the last 12 months could again not have been possible without our
amazing people here at Aussie. We strongly believe that looking after our staff ensures that
our customers are also treated with market-leading service. Strong growth often brings
challenges but we continue to focus on Aussie Broadband’s culture of “family”, ensuring all
our staff feel included and feel comfortable to bring their whole-self to work. We are excited
to include the Over the Wire team as a part of this family.
Following the completion of the acquisition of Over the Wire, we were delighted to welcome
Michael Omeros, the previous Managing Director & Group CEO of that business, to Aussie
Broadband’s Board as an Executive Director.
Alongside Michael’s appointment to the Board, John Reisinger stepped down from his Board
responsibilities while continuing with his executive responsibilities as Aussie’s Chief
Technology Officer. On behalf of the Board, I would like to acknowledge John’s outstanding
contribution to our business over the past 18 years, as a co-founder from the original
formation of Aussie Broadband’s predecessor company through the significant growth in
recent years culminating in the Over the Wire acquisition milestone.
John oversaw the development of our award-winning software and network infrastructure,
which has been the foundation for our rapid expansion. He has one of the most creative
technical minds in the industry, and we are delighted to have him continue as part of the
leadership team of the enlarged Aussie Group as we deliver on our Aussie 2.0 strategy.
We are immensely proud of the culture we have built at Aussie, with our values at the
forefront of what we do. These values will continue to be at the forefront of every decision
our staff make and are a strong guidance to how we will continue to conduct ourselves
across every business line.
As the company continues to grow, we are focused on continuing to uphold Aussie’s status
as the most trusted telco in Australia and that our culture continues to thrive. If this is
maintained, I have no doubt the successes that we have experienced so far will only
continue.
Managing Director's
address
Phillip Britt
At Aussie, we do things differently
Our evolution
FY22 growth across all key metrics…
…with continued strong & profitable growth
FY22 Strategic achievements
FY22 achievements
• Acquisition of Over the Wire and delivering $5.2m of annualised
synergies
• Launched our white label solution and onboarded over 58,000
broadband services
• Expanded our offering to business, enterprise & government
and wholesale segments with cloud, security, managed
services and expanded voice solutions
• Continued to operate as a challenger brand in the Australian
telecommunications and tech industry
• Increased software automation allowing us to have lower staff
touch and keep our operations onshore
• Completed the Fibre network rollout to the 83 NBN POIs, 22 data
centres and 77 multi-storey buildings unlocking significant
operation savings
• Network infrastructure was enhanced with upgrades to core
network equipment allowing us to scale past 1 million
broadband services
1Q FY23 trading update
• ABB residential and business delivered consistent
$184.4m
net adds to 4Q FY22 despite strong price based
Residential & business broadband net Mobile net additions Wholesale & white label net additions
additions
37,666 4,953 24,839
30,930
29,269 3,854
17,826
21,752 21,534 3,011
2,647 2,778
7,316 8,201
3,771
1Q FY22 2Q FY22 3Q FY22 4Q FY22 * 1Q FY23 1Q FY22 2Q FY22 3Q FY22 4Q FY22 1Q FY23 1Q FY22 2Q FY22 3Q FY22 4Q FY22 1Q FY23
* 4Q FY22 normalised to exclude OTW acquisition contribution 2Q & 3Q FY22 includes migration of Origin customers to white label
Market share
6.73%
NBN market share
95% 8.00%
94%
7.00%
50,000 1.00%
86%
40,000
30,000 85% 0.00%
Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22
20,000
Telstra, Optus, TPG & Vocus (LHS) Aussie Broadband (RHS)
10,000
All other RSPs (RHS)
-
Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22
Aussie Broadband Rest of industry NBN market share data based on ACCC market indicators report, excluding satellite
Trading update and FY23
guidance
FY23 guidance reaffirmed FY23 performance to date
• Guidance provided on 29 August 2022 and remains • Customer CVC usage lower than forecast and CVC
unchanged noting the upside and downside risks overage expense is under budget YTD
outlined in the FY22 results pack
• Churn remains inline with past 18-month trend
• Based on current market conditions, operating plan and
YTD trading, expect revenue of $800m to $840m • Despite strong retail price competition, ABB residential &
business has maintained consistent net adds compared
• Planned growth in higher margin business, enterprise to 4Q FY22 without heavy promotion usage, leading to
and government customers, and the full year benefit of improved margins, lower cost to acquire, and reduced
OTW, should deliver EBITDA margin (excluding long-term churn risk
integration costs) of c10-10.5%, up from 7.2% in FY22
• New mobile offerings and dedicated marketing focus
driving strong increase in mobile net adds
CFO’s Address
Good morning all, my name is Brian Maher and I am the Chief Financial Officer & Company
Secretary of Aussie Broadband and I am delighted to present this overview of the financial
results for the year ended 30 June 2022.
FY22 saw Aussie continuing its strong growth with Residential revenue increasing by 36%
and Business revenue 54%. Wholesale revenue increased by almost $25m following the
commencement of our first Whitelabel customer. Over the Wire contributed $38.5m of
revenue for the three and half months post-acquisition
The acquisition boosted the gross margin % in the second half of the year with like-for-like
margin modestly lower due to CVC costs increasing as a % of revenue.
Employee expenses increased faster than revenue, partly due to the acquisition with OTW
having a historically higher employee expense to revenue ratio than ABB but also in part due
to investments in acquiring additional skill sets to underpin future growth and the impacts of
a challenging labour market which have continued into FY23.
Marketing expenses increased at a rate lower than revenue but did represent an increase of
over $5m. The company did yield some modest operating leverage in administration costs.
Depreciation and amortisation expense (excluding those related to the intangibles arising
from the OTW acquisition) increased as we continue to invest in network infrastructure most
notably the roll out of the fibre network.
The financial position of the company changed significantly following the completion of the
OTW acquisition. This is most notable in plant & equipment, right of use assets, intangibles,
lease liabilities and deferred tax.
The increase in plant and equipment included $30m of spend on the fibre roll out.
While trade debtors increased year on year, debtor days are low at 19 days.
The acquisition was funded in part by cash raised from equity during the year and partly by a
new $175m syndicated debt facility.
Net debt at the end of the year was $138m with a pro-forma leverage ratio of 2.1x
It is worth noting that while a significant proportion of the debt funding was classified as
current in the financial statements, post year-end the tenor of Facility B amounting to $40m
was extended to a revised maturity date of March 2025.
The deferred tax liability arises from the tax effect of the intangibles recognised following the
acquisition. The balance is net of tax losses of $2.8m despite the profitable result due to our
ability to utilise the current tax concessions allowing us 100% deductibility in the financial
year of our fibre roll-out costs to the extent that they relate to completed legs of the network.
In summary FY22 was another solid financial performance
Financial performance
Financial position
Thank you