CABLE & WIRELESS OPTUS DELIVERS INTERIM PROFIT OF $135 MILLION

Cable & Wireless Optus today announced a bottom-line profit of $135 million for the six months to 30 September, driven by a 26 per cent growth in revenue to over $1.9 billion.

The half year profit of $135 million compares to a loss in the corresponding period last year of $38 million, and revenue of $1.5 billion.

As a result of the strong increase in revenue, the company's EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) rose 23 per cent to $558 million.

The result was driven by strong growth from the Mobile and Data and Business services divisions.

This was strongly supported by the Consumer and Multimedia division, with a significant increase in revenue from the HFC broadband network and Internet services.

Mobile revenue was up 19 per cent and Business Network Services up 76 per cent, with both businesses taking market share from their rivals.

Cable & Wireless Optus' Chief Executive, Chris Anderson, said the strong performance was a direct result of the company's consistent delivery on its commitments.

"During the period, while our traditional businesses grew strongly - the proportion of revenue from our newer businesses doubled. For example, there was a 76 per cent increase in revenue from our broadband network," he said.

In the past six months, Cable & Wireless Optus has increased its broadband customer base to more than 356,000 direct connections, with local telephony running at a rate of around 5,000 new installations a week.

"We have also increased broadband margins by encouraging more of our customers to take more than one service. This change in revenue mix, together with the increased customer base, has contributed significantly to our total EBITDA growth during the period."

Major highlights of Cable & Wireless Optus' results to 30 September include:

• EBIT (Earnings Before Interest and Tax) up 52 per cent to $187 million
• Mobile revenue up 19 per cent
• Business Network Services revenue up 76 per cent
• Broadband network revenue up 76 per cent
• Internet revenue up 125 per cent.

In the six months to 30 September, Cable & Wireless Optus' Mobile business performed strongly, increasing its GSM subscriber base by 27 per cent with the net addition of 439,000 customers.

With a total of 2.215 million mobile customers and having secured almost half of the total market growth in the September quarter, the company has taken market share from competitors and is growing at a faster rate than the total GSM market.

The company's Data and Business division delivered growth of 25 per cent, with a significant increase in its data and e-commerce capabilities and improvements in network returns.

Consumer and Multimedia, Optus' third division, is enjoying the highest rate of growth, around 47 per cent.

This performance is driven by rapid penetration of the local call market and a tripling of consumer Internet subscribers in the past 12 months. The company is already the third largest ISP in Australia, a position it expects to improve with the launch of its Optus@Home cable modem service.

Mr Anderson said the company's strong infrastructure, and its mobile, Internet and IP businesses, positioned it well for future growth and profits.

"We intend to continue to enhance shareholder value by pursuing our vision - focusing on the key business, data and IP markets, cost effectively serving our significant base of mass market customers and leveraging the growth of wireless communication," he said.

For more information:
Stephen Woodhill
Cable & Wireless Optus
Phone: 02 9342 7850