Research and Markets: iiNet Ltd.: The First-mover Advantage in Naked DSL Drives iiNet's Growth and Margins

2008-12-11 17:23:05 -

Research and Markets (www.researchandmarkets.com/research/c91f1d/iinet_ltd_the_fi) has announced the addition of IE Market Research Corp.'s new report "iiNet Ltd.: The First-mover Advantage in Naked DSL Drives iiNet's Growth and Margins" to their offering.
This market research report on iiNet Ltd. provides a comprehensive analysis of its strategies, operational and financial metrics. The report covers the key strategic issues facing the company and provides forecasts on its operations, notably we analyze the strength of iiNet's Naked DSL in the Australian telecommunications sector. Beyond Naked DSL, we think that iiNet promises a pipeline of innovative product and content offerings. This highlights Telstra's inability to offer a product to compete with Naked DSL without putting its PSTN revenue base at risk. With only the smaller ISPs offering similar products we expect iiNet to continue to gain market share. During 2H08 iiNet alone took 7.1% of fixed broadband net adds, pushing market share up to 4.9%. Total market share including Westnet now stands at 7.7% making it the clear #3 ISP in Australia.
Key Topics Covered:
- Naked DSL drives iiNet's growth & margins with Telstra and Optus still not offering equivalent products
- With a pipeline of innovative offerings, iiNet takes 7.1% share of fixed broadband net additions
- FTTN remains the biggest uncertainty for the industry; we should finally get some clarity in 1H09
- Other than FTTN, the primary catalysts for iiNet are Naked DSL and Westnet integration
- iiNet's FY08 results: 21% EBITDA growth, 12% NPAT growth
- iiNet has outgrown all of its larger rivals during 2H08: Above 30,000 Naked DSL subscribers, growing at 1,000/week
- iiNet's market share: Naked DSL has driven market share gains during 2H08
- iiNet's gross margins have improved to 19% as more of the broadband subscriber base has been migrated on-net
- iiNet's expenses: Operating expenses up +25.8%, personnel costs up +28.1%
- Network infrastructure: iiNet's focus has shifted from enabling new exchanges to capacity expansion in its existing DSLAMs
- Capex to ramp up to $26m during FY09 as iiNet focuses on expansion of ports in its exchanges
- Integration of the Westnet business is one of the top priorities for iiNet during FY09
- Further M&A - Will iiNet be predator or target?
Charts:
- Chart 1: iiNet's revenue composition, FY08
- Chart 2: Broadband subscribers (000s) & Market Share - excluding Westnet
- Chart 3: On-net margins ($/month)
Tables:
- Table 1: iiNet Profit & Loss ($ millions)
- Table 2: 2H08 Broadband Growth Rates
Companies Mentioned:
- iiNet
- Telstra
- Optus
For more information visit www.researchandmarkets.com/research/c91f1d/iinet_ltd_the_fi


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