Broker update - PT $8.19/share by Deutsche Bank, page-71

Sorry, non-BAU is the wrong term to use. Growth capex, i.e. capex not used to maintain current earnings, is what I was referring to - last slide of the AGM presentation.

They forecast 7-9% of revenues as future capex spend, the last slide shows 9.7% - so a little above. Nevertheless, the breakdown is as follows:

$28m - sustaining capex
$84m - growth capex
$32m - IRU (depending on how much is utilised, could be growth or sustaining capex)
$42m - "improvement" capex


As for NBN subscribers - a lot of these are conversions from their current copper offering to the new network. I agree this is where the long game is at, but remember there are costs associated with the transfer. There's a capex/opex charge for each and in the short-term (this FY) profitability won't be great on these (it will be profitable, but not as much as would otherwise be the case).

For me, there are two aspects that really entice me here:
1) NBN growth, as you've described. But not for the short term results (customer churn rate is good enough to take a hit in the first year and make it very worthwhile)

2) Utilisation of the fibre network: When I hear that 90% of the Nextgen network capacity is available, along with atleast 70% of the Vocus network, one can only think of the fixed costs that are in place already, and what future revenues would do to profitability. The new net MRR in the Wholesale/corporate division is a figure that I track closely. So long as it's increasing, then the network capacity is slowly utilised.