Telstra (TLS) is Australia’s largest telecommunications provider and is a major mover on the ASX. Its main activities include the provision of; local and long distance telephone calls, mobile phone services, broadband access, search and information services, and the Foxtel cable service.
TLS has reported a 4.7% slump in FY10 net profit to $3.9 billion, which was in line with analyst estimates, although sales revenue declined 2% from a year ago.
Revenue dropped the most at TLS’s fixed line (PSTN) division, which continues to see an exodus of customers migrating to its competitors’ wireless services.
Most worrying however was the group’s forecast for flattish sales growth in FY11, indicating that its plans to transition away from fixed line services to wireless broadband offerings are going to take time.
TLS declared a final dividend of 14 cents per share, which was also in line with market consensus.
Australian stock price for TLS plunged 9.5% after its weak sales forecast.