NBN Co defends steep losses

NBN Co chief executive Stephen Rue has defended losses that have ballooned to $692m and a $400m increase in capital expenditure.

The government-owned telco expects a dramatic turnaround in the years to come and to recoup some of its debt amid rising demand for data and faster internet.

Mr Rue told investors “we make no apology” on the increased capital expenditure, which grew by $457m to $1.86bn, later saying that it was core to the telco’s strategy. He said the fibre business was a growth one that would eventually increase its $47 average revenue per user.

“In terms of revenue, what you would expect to see is more consumers on higher speeds over time and you would therefore expect to see our average revenue per user grow,” he said.

NBN CO recorded a further $252m in losses in the six months to December 2023 to a total of $692m, but says it will look to deploy artificial intelligence to become more efficient.

Revenue, meanwhile, firmed 5 per cent to $2.75bn, following increased business customer demand. But the company failed to increase the average revenue per user, which sits at 2022 levels of $47.

Mr Rue was “pleased” with the result, saying NBN was on track to meet full-year guidance.

He said there was still major demand for high-speed internet, and about 200,000 Australian premises had upgraded to NBN’s full fibre service.

“We continue to deliver our network upgrade programs on time, on budget and for the community’s benefit,” Mr Rue said. “We closed the half-year with more than 8.4 million premises, or 75 per cent of the fixed line network, eligible to access the nbn Home Ultrafast speed tier, a remarkable outcome which means these customers can now gain access to peak wholesale download speeds of 500 Mbps to close to 1 Gbps.”

NBN research showed the data the average household consumed had grown 10-fold over the past decade.