NBN Co has now shifted “around 375,000” users to full fibre connections courtesy of its fibre-to-the-node and fibre-to-the-curb overbuild programs, with claims it managed to convert 10,000 premises in a single week.
The company reported the 375,000 take-up figure in its FY24 full-year results, up from 106,000 at the end of FY23.
At 375,000, take-up is short of an earlier expectation of 402,000 conversions by the end of June.
However, the company’s run-rate in upgrading premises continues to increase and came in at about 7000 a week across the year, having previously averaged at a bit over 6000.
“We’ve seen really strong demand for fibre with all retailers now in-market [selling upgrades],” chief customer officer Anna Perrin told an FY24 results briefing.
“It does fluctuate, but on average it’s around about 7000 a week, but we’ve had weeks as high as 10,000 a week.
“We can see that demand is growing and that customers on fibre report a higher customer satisfaction because of the reliability of fibre overall.”
Perrin told iTnews that demand “is in line with expectations”.
She did not address the previous yearly take-up targets, arguing - as the company previously has - that its work spans multiple years - with the implication that granular movements between yearly numbers are of limited concern.
“The fibre rollout program is a 10-year program. This is a long-term infrastructure program over many years,” she said.
“We had a slower start but it’s not something we are concerned about, and that was just as retailers got their IT systems and marketing programs in place.
“Now that we can see that all of those things have happened, we can see the activation rate is well within where we would expect it to be, and we can see demand for fibre just continues to grow.”
The company provided a breakdown of upgrades by technology in response to a question by iTnews.
Of the 375,000 converted premises, 218,000 upgraded from FTTN to FTTP in FY24 (for a total of 278,000 FTTN upgrades overall), while 67,000 moved off FTTC in FY24 (97,000 overall).
iTnews has confirmed these figures as accurate with NBN Co.
Efficient operations
NBN Co’s interim chief financial officer Richard Cairns said that operating expenses for FY24 came in at $1.7 billion, “an improvement of five percent compared to the prior year.”
“This was achieved through ongoing efficiency across the business, which offset a number of underlying inflationary cost increases,” he said.
“Within operating expenditure, direct network costs decreased by two percent, which was predominantly due to lower assurance costs with fewer service incidents and truck rolls during the year, along with ongoing efficiency in our network maintenance and operations.”
NBN Co’s “employee benefit expenses”, meanwhile, were down 13 percent year-on-year.
“This was largely due to lower average internal headcount as NBN Co continues to focus on operating efficiency and optimising our resourcing,” Cairns said.
Interim CEO Philip Knox said that headcount “shouldn’t grow” in the immediate period, but that he was more concerned with other costs in any event.
Other operating expenses, including IT, software and maintenance, “remained largely flat during the year”.
Future revenue
In FY24, average revenue per user (ARPU) was $47.
Knox said that winning work in new housing estates would be the bulk of new revenue opportunities for the company.
He said NBN Co was not looking to create “additional adjacency revenues” outside of its present remit.
“I think we’ve got plenty of [revenue] opportunities in our current remit, in our current arrangements,” he said.
“New revenues will largely come from new estates. We’re quite happy with the revenue possibilities we have going forward.”
For the year, NBN Co reported total revenue of $5.5 billion, up four percent, and earnings before interest, tax, depreciation and amortisation (EBITDA) of $3.93 billion, up nine percent.
Both were within the guidance range set out in the company's corporate plan 2024
The company also finished paying back the long-running $19.5 billion Commonwealth government loan, which it had previously raised debt to do.
