Also on Wednesday, Penn reported a 36 percent increase in full-year profit for Telstra to $5.8 billion. “We will simplify products and platforms – we need to retire old technology and systems that slow down and complicate how customers are served”, he added.
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It also revealed it would hand $1.5 billion back to shareholders through a $1.25 billion off-market share buy-back and a $250 million on-market share buy-back. This will see its capex to sales ratio increase to 18 per cent, the highest ratio since Telstra’s 3G network investments in 2008 and 2009.
Details of the investment program will be progressively confirmed during 2017 to 2019 financial years to maintain strategic advantage in a heavily competitive environment.
“We know that customers expect more from us as their reliance on smart devices continues to grow”, Mr Penn said.
CEO Andrew Penn, in announcing the telco’s annual results today, made direct reference to a series of embarrassing network outages this year.
“Over the second half of the year we experienced a number of issues within the mobile, fixed broadband and IP networks”, the CEO said.
“This will position us to deliver significant customer benefits and reinforce our market differentiation over the longer term”, Penn says.
“We’re also committed to putting customers at the heart of everything we do – it’s that that’s driven this decision to make this significant investment”, Penn said. “We have taken extensive and end to end reviews of the networks involving worldwide experts and independent experts”.
“We expect these changes will deliver a customer experience that is fundamentally better when they interact with Telstra and as we create financial benefits for shareholders”.
“The investment is about setting the pace for the network and company of the future, just as we have done in each of the previous network generations”.
“We’re well progressed in relation to this program of investment and we have already substantially improved our recovery times within the mobile network”, Penn said.
Network investment will include building next-generation networks and mobile, including boosting capacity in key networks, ongoing evolution of 4G capabilities and 5G network readiness, LTE-broadcast, voice over LTE and the Internet of Things.
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The CEO also noted that during the year Telstra had achieved 98 per cent population coverage with its 4G services and upgraded more than 2000 network sites to support 700MHz (‘4GX’).
