Telstra 2009 Annual Report Download - page 46

31
Telstra Corporation Limited and controlled entities
Full year results and operations review - June 2009
• goodwill rose by $329 million, of which $228 million
was foreign exchange related. Goodwill also
increased by $233 million from recent Chinese
acquisitions, partly offset by a reduction of $127
million as a result of the sale of KAZ.
• software intangibles rose by $755 million via our
investments in IT transformation billing related
systems.
• other non current assets increased primarily due to the
$629 million rise in the value of our non current cross
currency and interest rate swap hedge receivables.
• total current and non current borrowings, excluding
derivatives, increased by $1,824 million which drove the
increase in gross debt of $751 million. Items offsetting
this increase included a reduction in our net derivative
liability position of $1,077 million which is included
within other assets and other liabilities.
• The movement in gross debt comprises:
• net cash inflow of $794 million (new borrowings of
$2,627 million, offset by net maturities of $1,833
million).
• net revaluations gains of $67 million.
• finance lease additions of $24 million.
• our net debt position at 30 June 2009 was $15,655 million
which represents an increase during the fiscal year of
$269 million. Despite the increase in net debt our gearing
ratio fell slightly from 55.7% as at June 30 2008 to 55.2%
as at 30 June 2009.
• other non current liabilities were also impacted by the
turnaround of our defined benefit pension balance from a
$182 million asset at June 2008 to a net defined benefit
liability of $406 million. This was due to an actuarial loss
of $553 million of which $593 million was caused by the
significant decrease in the value of the assets held by the
superannuation plans as a result of the current financial
crisis causing lower asset returns.
• equity attributable to Telstra Entity shareholders
increased by 3.3% for the year due to increases in
retained earnings and the foreign currency translation
reserve.
Capital expenditure
• Declined by 6.1% to $4,598 million which was within our market guidance range
• The decline was driven by the completion of several major projects and programs in the prior year
Our operating capital expenditure declined by 6.1% to $4,598
million in fiscal 2009 mainly due to the following categories:
• transmission spend declined by $228 million partially
due to the completion of the Asia-America Gateway
project. Also, the program to increase transmission
capacity in metropolitan areas has been completed;
• IT capex reduced by $125 million primarily driven by the
completion of significant IT transformation programs in
fiscal 2008;
• fixed access spend was lower than last year by $112
million due principally to a combined reduction across
several programs. The spend in fiscal 2009 was impacted
by unit cost reductions due to fewer high cost structural
and short network extension projects. Some projects
were also impacted by delays associated with the floods
in Queensland and New South Wales; and
• Sensis decreased by $45 million due to a delay in works in
transformation while the program is being re-scoped.
This was partly offset by the upgrade to IT systems and
improved business processes across the Sensis core
product chain.
Operating capex by technology on an accruals basis
Year ended 30 June
2009 2008 Change Change
$m $m $m %
Fixed access. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 708 820 (112) (13.7%)
IT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,127 1,252 (125) (10.0%)
Land and buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 283 295 (12) (4.1%)
Network core . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 628 546 82 15.0%
Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 257 8 3.1%
Sensis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212 257 (45) (17.5%)
Transmission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369 597 (228) (38.2%)
Wireless access. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 430 443 (13) (2.9%)
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 301 244 57 23.4%
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 275 186 89 47.8%
Operating capital expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,598 4,897 (299) (6.1%)