Merger with M2 makes Vocus a force in NZ

ASX listed Vocus Communications (ASX: VOC) has almost tripled its New Zealand revenues for FY16, following its merger with trans-Tasman telco group M2 in February this year. It has set itself the goal of being “the leading challenger telco across Australia and New Zealand.”

The company announced its results for the year to 30 June 2016, reporting a net profit after tax of $A64.1m, EBITDA of $195.0m on revenues of $A830.8m. In New Zealand it owns the CallPlus, Flip, Slingshot, Orcon and 2Talk brands.

NZ revenues rose from $A50.7m ($53.0m) in FY15 to $A145.5m ($152.1m) of which $A86.6m ($90.5m) came from former M2. Fibre and Ethernet services accounted for 50 percent of revenues, Internet services 19 percent, voice 23 percent and data centre services eight percent.

The bulk of new revenues came from M2 consumer customers (43 percent of total. M2 corporate customers accounted for 17 percent. Prior to the merger Vocus had a minimal presence in the consumer market.

In the six months since December 2015 the company has added 6000 consumer UFB services taking its total to 27,000 and 4,000 naked DSL services, to 52,000. Bundled DSL services declined from 118,000 to 113,000.

The merged entity now has a New Zealand staff of 700, three data centres, 4,600kms of inter-city fibre networks and a claimed 14 percent of the consumer broadband market.