Telstra 2011 Annual Report Download - page 44

29
Telstra Corporation Limited and controlled entities
Full year results and operations review - June 2011
Major subsidiaries - financial summaries
Below is a financial summary of our three largest
subsidiaries: Sensis, CSL New World and TelstraClear.
This information is complementary to the product
analysis previously provided in the document and is
intended to show these businesses as stand alone
entities.
Sensis financial summary(i)(ii)
Amounts included for Sensis represent the contribution to Telstra’s consolidated result.
(i) Chinese online businesses are no longer reported within Sensis (Sequel is now in Telstra International and SouFun was in the Other segment until its sale)
so all prior period amounts have been removed from the Sensis financial results.
(ii) The above results differ from the segment results reported on page 7 as for segment reporting purposes we monitor our results excluding the impact of
investment sales. In the prior corresponding period, Sensis disposed of Universal Publishers which resulted in a net loss of $9 million.
Sensis total income is split into the following categories:
Sensis is our advertising subsidiary. Sensis helps you
find, buy and sell through service offerings including
Yellow Pages®, White Pages®, 1234, Citysearch®,
Whereis®, MediaSmart® and Quotify®.
In March 2011, Sensis launched a digital strategy for
long term profitable growth. This strategy is designed
to help Australian buyers and sellers benefit from the
rapidly evolving digital environment. In particular, this
strategy seeks to empower small business advertisers
with competitive marketing solutions.
Sensis total income declined by 5.9% to $1,787 million
and EBITDA declined by 9.3% to $994 million, primarily
as a result of the structural shift from print directories.
In addition, contributing to the decline in performance
was the impact of the floods throughout the east coast
of Australia and the investment associated with the
deployment of the new strategy.
The primary driver of the results has been a reduction
of Yellow Pages revenue by 11.4% resulting from a
decline in Yellow Pages print directories of 15.8%
partially offset by growth in Yellow Pages digital of
6.3%. In the second half, Yellow Pages digital revenue
grew 12.8% year on year, driven by an increase in take
up of digital offerings. The decline in Yellow Pages print
revenue has arisen from higher cancellations and
declining yields as customers migrate their advertising
to online solutions.
White Pages revenue increased by 5.1% to $436
million. This was driven by an increase in White Pages
print of 2.8% and an increase in White Pages digital
revenue of 39.3% due to growth in the number of
customers taking the online package product.
Operating expenses declined by 1.4% from the prior
year mainly driven by lower paper, printing and
distribution costs.
The increase in capital expenditure was associated with
our investment in new product development and
expanded product offerings.
Year ended 30 June
2011 2010 Change Change
$m $m $m %
Total income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,787 1,900 (113) (5.9)
Operating expenses (excl. depreciation and amortisation) . . . . . . . . . . 793 804 (11) (1.4)
EBITDA contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . 994 1,096 (102) (9.3)
Depreciation and amortisation. . . . . . . . . . . . . . . . . . . . . . . 123 84 39 46.4
EBIT contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 871 1,012 (141) (13.9)
Capital expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 94 40 42.6
EBITDA margin on sales revenue . . . . . . . . . . . . . . . . . . . . . 55.6% 57.4% (1.8)
Year ended 30 June
2011 2010 Change Change
$m $m $m %
- Yellow Pages® revenue . . . . . . . . . . . . . . . . . . . . . . . . . 1,119 1,263 (144) (11.4)
- White Pages® revenue . . . . . . . . . . . . . . . . . . . . . . . . . 436 415 21 5.1
- Digital marketing services . . . . . . . . . . . . . . . . . . . . . . . . 212 212 - -
- Other revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13(2)(66.7)
Total Sensis advertising and directories . . . . . . . . . . . . . . . . . . 1,768 1,893 (125) (6.6)
Other sales revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 16 3 18.8
Total Sensis sales revenue . . . . . . . . . . . . . . . . . . . . . . . . 1,787 1,909 (122) (6.4)
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -(9) 9 100.0
Sensis total income. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,787 1,900 (113) (5.9)