Tel­stra un­der pay­out stress

Townsville Bulletin - - NEWS -

TEL­STRA shares are un­der fresh pres­sure fol­low­ing chair­man John Mullen’s com­ments that the telco’s fu­ture as a div­i­dend­pay­ing busi­ness could be on the wrong side of his­tory.

In an age of new- tech giants such as Ama­zon, Mr Mullen ac­knowl­edged Tel­stra would be in a dif­fer­ent po­si­tion to­day if it had di­verted div­i­dend funds away from share­hold­ers and into an Ama­zon- killing war chest.

“If Tel­stra hadn’t paid a div­i­dend for 10 years we’d have a $ 50 bil­lion war chest to take on these new com­peti­tors,” Mr Mullen told Sky News Busi­ness.

Mr Mullen’s com­ments come af­ter Citi an­a­lyst David Kaynes sug­gested last week that, on its cur­rent tra­jec­tory, Tel­stra’s earn­ings per share will be flatlin­ing at 17c within two years.

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