TPG Telecom Limited (ASX:TPG) Announces HY25 Results and Capital Management Plan
Financial Performance
TPG Telecom reported a 2.2% increase in service revenue to $2,060 million for the half year ended 30 June 2025, driven by an addition of 100,000 mobile subscribers following regional network expansion. EBITDA rose by 1.0% to $813 million, and net profit after tax reached $32 million. Operating free cash flow increased by 34.6% to $171 million due to lower capital expenditure and improved working capital management.
Dividend and Capital Management
The company declared an interim dividend of 9.0 cents per share, with a new policy to increase dividends over time, subject to sustainable profit and cash flow growth. TPG Telecom is on track to return up to $3 billion to shareholders through a capital reduction plan, including a pro rata cash distribution and a reinvestment opportunity for minority shareholders. Additionally, the company has repaid approximately $1.7 billion of bank borrowings, reducing net bank borrowings to $2.4 billion.
Outlook
TPG Telecom provided guidance for FY25, expecting Pro Forma EBITDA between $1,605 million and $1,655 million, and cash capital expenditure of $790 million. The company remains focused on capital efficiency and maintaining its scalable cost base to support future growth.
Executive Comments
CEO Iñaki Berroeta stated, “This was a transformational half year for TPG Telecom. We are now mobile-led and simpler to run following the sale of our fibre infrastructure and Enterprise, Government and Wholesale (EGW) Fixed assets to Vocus. Following the establishment of our regional network infrastructure sharing agreement, with greater mobile coverage across Australia, we are now positioned for growth and strong revenue momentum. We are well placed to continue to win market share in Mobile and we are focused on delivering value for customers and shareholders by running our network smarter, simplifying and digitising the customer experience and maintaining operating cost discipline. With a scalable cost base and capital-efficient operating model post the Vocus Transaction, we’re confident in delivering our capital management plans over coming months and further cash flow upside in years to come.”
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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