CNU
25/11/2014 09:21
GENERAL
NOT PRICE SENSITIVE
REL: 0921 HRS Chorus Limited (NS)
GENERAL: CNU: Chorus reduces UFB connection cost guidance
STOCK EXCHANGE ANNOUNCEMENT
25 November 2014
Chorus reduces UFB connection cost guidance
Chorus announced today that it has signed new service company agreements for
the cost of connections to its ultra-fast broadband network.
The new agreements have enabled Chorus to update its connections cost
guidance for the current financial year from a previous range of $1,300 to
$1,500 (excluding layer 2 and for standard installations only), to a new
range of $1,150 to $1,350 (excluding layer 2 and including standard
installations and some non-standard single dwelling unit installations).
The new agreements are with Visionstream and Downer for fibre network
connections to single dwelling unit premises in its Auckland, lower North
Island and lower South Island UFB areas. Under the contracts, the service
companies will provide network connections at fixed prices, with those prices
varying according to agreed deployment types.
Chorus GM Infrastructure Ed Beattie said Chorus has been focused on reducing
its connection costs now that UFB connections are gaining momentum.
"These new contracts and updated pricing are linked to an ongoing national
tender process.
"With the experience of about 40,000 connections to the fibre network now
behind them, daily connection volumes becoming more consistent and new
deployment methods in use, service companies have been able to identify
efficiencies earlier than expected," he said.
Visionstream's contracted pricing will apply from 1 December to February
2016, with the ability to extend the contract to the end of 2019 subject to
pricing and performance. The contract with Downer is retrospective for the
period 1 July 2014 to the end of February 2015.
The fixed rates under the Downer and Visionstream agreements will also apply
to non-standard single dwelling unit connections, with this simplified
approach enabling some reduction in associated non-standard install costs.
Chorus' tender process is continuing for non-Auckland areas and is expected
to be concluded by the end of December and implemented by February 2015.
There is no change to Chorus' forecast FY15 'UFB connections and layer 2'
capex of $105 million to $115 million. While connection costs are expected to
be lower, connection volumes are currently ahead of budget in the year to
date.
ENDS
For further information:
Nathan Beaumont
Media and PR Manager
Mobile: 021 243 8412
Email: [email protected]
Brett Jackson
Investor Relations Manager
Phone: +64 4 896 4039
Mobile: +64 (27) 488 7808
Email: [email protected]
End CA:00258040 For:CNU Type:GENERAL Time:2014-11-25 09:21:50
