More goodies from a major company reporting its June 30 results with Telstra (TLS) this morning boosting final dividend and announcing a $1 billion sharebuyback.
The telco also revealed a second half surge in earnings.
Speculation about a possible buyback and a second lift in dividend in a year helped drive Telstra’s share price to five year highs in recent months. It closed at $5.44 yesterday, just shy of its 12 month (and five year high of $5.53).
TLS 1Y – Telstra sweetens dividend
The buyback matches suggestions coming from the company and investment analysts that Telstra could reveal capital management plans with the final result.
Yesterday the Commonwealth Bank revealed a record result and dividend of $4.01 for the year to June 30.
Telstra lifted full year profit by more than 14% to $4.27 billion for the year to June 30, up from $3.74 billion in 2012/13.
It lifted its fully-franked final dividend one cent to 15 cents per share, taking the full year payout to 29.5 cents, up from 28 cents in 2013.
It also announced a $1 billion off-market share buy-back to boost shareholder returns.
The share buyback will be funded from the cash generated from the sales of Telstra’s 70% stake in directories business Sensis, and the telco’sT 74.6% interest in Hong Kong mobile provider CSL, as well as the company’s improving cash flows and earnings.
Revenue for the year from continuing operations, (which strips out the Sensis business Telstra offloaded during the year) was $25.32 billion, up 3.5% on the previous year.
Full year net profit growth of 14.3% was quicker than the 9.7% rise seen in the six months to December.
Earlier this week, Telstra said it would pay $291 million to lift its stake in the video streaming and analytics platform Ooyala to 98%.
