S&P/ASX 200 Index (ASX: XJO) stock Chorus Ltd (ASX: CNU) is setting the bar high today.
Shares in the New Zealand based telecommunications infrastructure company closed on Friday trading for $7.26. In morning trade on Monday, shares are swapping hands for $7.95 apiece, up 9.5%.
For some context, the ASX 200 is up 0.4% at this same time.
This outperformance comes following the release of Chorus' financial results for the year ended 30 June (FY 2024).
Here are the highlights.
(*Note, all figures are in New Zealand dollars.)
Chorus share price surges on rising earnings
- Revenue of $1.01 billion, up 3.8% from FY 2023
- Earnings before interest, taxes, depreciation and amortisation (EBITDA) of $700 million, up 4.2% year on year
- Net loss after tax of $9 million, down from an FY 2023 net profit of $25 million
- Operating expenditure of $310 million, up 0.7%
- Final unfranked dividend of 28.5 cents per share; full-year dividends of 47.5 cents per share
What else happened with the ASX 200 stock in FY 2024?
The Chorus share price is catching tailwinds today after the company reported ongoing progress with its fibre connection rollout. Fiber connections reached 1.084 million in FY 2024, up by 53,000.
The ASX 200 stock reported that fibre uptake now stands at 71.4% of addresses, up 2% year on year. This was accompanied by a 35% decline in the company's remaining copper connections, which fell to 157,000.
Network traffic was also up over the financial year, rising 8% from FY 2023 to 7,974 petabytes.
Chorus credited the 3% increase in annual revenue to inflation-linked price changes and ongoing growth in the uptake of its high-speed fibre plans.
The ASX 200 stock said the swing from profit to net loss was driven by a one-off $15 million non-cash tax expense following the removal of the deductibility of tax depreciation for buildings and an $11 million increase in depreciation from its accelerated depreciation of Chorus' copper assets. Interest costs were also higher than the previous year.
FY 2024 also saw Chorus please passive income investors by lifting its dividend payout range. After sustaining capex, this range was increased from the prior 60% to 80% to 70% to 90% of net operating free cash flows.
What did management say?
Commenting on the results sending the ASX 200 stock soaring today, Chorus CEO Mark Aue said, "We accelerated our program to retire the copper network and there are fewer than 45,000 copper connections remaining where our fibre is available."
Aue said the company is on track to retire copper from its urban fibre areas by the end of 2026.
Aue added:
We've closed more than 1,250 copper broadband cabinets so far and will soon have our first fibre-only suburban exchanges. We're already seeing the benefits of this shift with electricity usage down by another 3 per cent in FY 2024 as legacy network equipment is powered down.
What's next for the ASX 200 stock?
Looking at what could impact the Chorus share price in the year ahead, and likely helping boost investor sentiment today, the ASX 200 stock offered the following FY 2025 guidance:
- EBITDA of $700 million to $720 million
- Gross capital expenditure of $400 million to $440 million
- Sustaining capital expenditure of $200 million to $220 million
- Full-year dividends of 57.5 cents per share, unfranked
Chorus share price snapshot
With today's big Chorus share price gains factored in, the ASX 200 stock is up 8.6% so far in 2024.
