Rants, Raves, Reviews

iiNet are back from the ASX wasteland

By Gary R, in , posted: 29-May-2006 12:33

iiNet are back on the ASX. So far (at time of writing) 8,903,000 shares have been traded at $.73 a massive 56.8% drop! The last time the shares traded they were at $1.69.

iiNet have provided a very comprehensive EBIT Variance Analysis. Originally iiNet forcasted an EBIT of $40.1m this has now been downgraded to $24.6m. 

Some interesting stuff:
customer credits - $1.9m
Double counting of Usage Revenue - $1.8m
Professional Fees - $1.1m (this how much iiNet spent on disputes taken through the ACCC against Telstra!)
Dial Revenue Shortfall - $3.1M (dodgy billing data)
ADSL ARPU Shortfall - $1.4M
Voice ARPU Shortfall - $1M

iiNet have also announced a strategic alliance with Powertel.

Now, if I was a shareholder I would be concerned with the inaccuracy of the financial information provided by iiNet. Without a doubt iiNet will be and are going to be punished on the sharemarket.

iiNet are the third largest ISP in the Australia and they have invested heavily in DSLAMS and infrastructure. It goes to show that this LLU is not all that it appears to be.

Other related posts:
The Butler and Butler 5 Point Plan
National to invest in broadband
We Blew our cap again

Comment by Michael, on 29-May-2006 16:58

First, it's not LLU, it's ULL - unbundled local loop. And second, iiNet do not use ULL, yet. They use SSS.

Author's note by Jama, on 29-May-2006 17:15

Well Michael it depends on the context. Local Loop Unbundling or Unbundled Local Loop. Refer to Wiki - both are valid. Spectrum Sharing Service (SSS) is similar in principle to LLU or ULL.

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