Australian operator Vocus announced plans to sell its activities in New Zealand. At an analyst presentation, the company said it's in the process of picking advisers and aims to complete the sale by the end of June 2018.
The recent strategic review following the rejected takeover bid from KKR has also led to a decision to divest its Australian data centres. The proceeds from the divestments will be used to reduce debt and provide financial flexibility for strategic options.
Vocus provides both consumer and enterprise services in New Zealand, under the brands Orcon, Slingshot, Flip, Switch, 2Talk and Vocus. It recently added energy services to its mass-market portfolio, which counted 189,000 consumer and 21,000 SMB broadband customers at the end of June. In fiscal 2017, the business, built largely from a string of acquisitions, generated EBITDA of AUD 57.5 million on revenues of AUD 323 million.
Vocus also gave a trading update for its Australian business in the fiscal first quarter. NBN customers rose by 53,000 in the quarter to a total 230,000, and the operator also relaunched the iPrimus brand with new mobile and broadband plans in mid-October. Dodo energy subscribers were down in the quarter after price rises, as were broadband customers at legacy brands.
In addition, the company said the ASC submarine cable system to Singapore is on track to start service in the first quarter of its 2019 fiscal year. It also agreed with vendors to reduce deferred payments on the project to USD 8 million from USD 20 million.
Overall, Vocus said the Q1 results put it on track to meet its full-year guidance. Revenue is forecast to grow to AUD 1.9-2.0 billion from AUD 1.8 billion, underlying EBITDA will increase to an estimated AUD 370-390 million from AUD 366 million last year, and capex will be up slightly to AUD 190-210 million plus USD 42 million for the ASC project. Net debt is expected at AUD 1.03-1.06 billion by year-end from AUD 1.03 billion at the end of June 2017.
