Offering set back to get most out of cost-cutting measures
SYDNEY — The long-delayed IPO and Australian Stock Exchange listing of Optus is likely to be delayed again until 1999 to give a massive cost-cutting program time to take effect.The Aussie cabler and telco, which is controlled by the U.K.’s Cable & Wireless, revealed a better-than-expected net loss of A$83.6 million ($56 million) for the six months to Dec. 31. The result shows Optus is on the road to recovering from its disastrous flirtation with pay TV, which is thought to have lost it about $600 million to date. Cost savings came from pinkslipping about 1,200 staffers, while earnings before interest, tax, depreciation and amortization were $230 million, up from $127 million in the previous period. “The heady days, the giddy days of start-up at Optus are over,” Optus topper Chris Anderson said. “The battle for bottom line is on.” This was the first accounting period that the telco had full control of the Optus Vision feevee service, after the exit of warring shareholders US West, Kerry Packer and Kerry Stokes. While Optus refused to reveal separate feevee loss figures, pay TV revenues rose to $32 million from $18 million, although subscriber levels remained low, at 180,000. The Optus results came just days after Rupert Murdoch’s Aussie cabler Foxtel appeared poised to break even by the year 2000, following a dramatic dip in its losses. According to major Oz telco Telstra, a Foxtel shareholder, Foxtel’s loss for the six months ended Dec. 31 was $57.6 million, a turnaround from the 1996-97 full year loss of $142 million. Foxtel now has 280,000 subscribers. The figures were revealed in Telstra’s first profit statements since a partial IPO last November. Telstra posted half-year post-tax profits of $1.1 billion, an Australian record.