PowerTel switches on financial turnaround

PowerTel has managed to turn around its business to produce from an $8 million loss in 2005 to a $10 million profit for the year ending 31 December 2006.

PowerTel has managed to turn around its business to produce from an $8 million loss in 2005 to a $10 million profit for the year ending 31 December 2006.

Operating cash flow for the year increased 103 percent to $35.3m and an EBITDA of $39.8m, up 48 percent on the previous year, was also recorded.

PowerTel managing director Paul Broad said the company’s turnaround was attributable to disciplined cost management and a focus on profitable revenue growth.

“We’ve done this despite a highly competitive market where we are seeing strong price erosion coupled with a challenging regulatory environment,” he said in an ASX filing.

“This is where we consistently see the benefits of having our own network and our exclusive wholesale access to the iiNet network.”

Broad said that the company’s decision to invest in iiNet – the ISP holds 18.3 percent of its shares an board representation – had payed off its exclusive wholesale access to more than 300 exchanges making it the second largest DSL access network in Australia.

“In addition iiNet has the largest high speed ADSL2+ network in the country,” he said. ”This combined with PowerTel’s substantial nationwide network has enabled us to be a significant alternative wholesale competitor in the Australian market.”