By Stuart Condie


SYDNEY--Telstra Corp. Ltd. increased its full-year dividend for the first time in seven years after lifting annual earnings by 8.4% and confirming expectations of another rise in the 2023 fiscal year.

Australia's largest communications provider on Thursday reported underlying earnings before interest, tax, depreciation and amortization for the 12 months through June of 7.3 billion Australian dollars (US$5.17 billion), compared with A$6.7 billion a year ago.

Telstra had guided for underlying Ebitda of between A$7.0 billion and A$7.3 billion, while the average analyst forecast was A$7.27 billion, according to data compiled by FactSet. Telstra said the increase was driven by improved mobile and international earnings.

Statutory net profit fell by 9.1% to A$1.69 billion. The board raised its final dividend to 8.5 Australian cents per share from 8.0 Australian cents a year ago, for a full-year payout of 16 Australian cents.

Telstra expects underlying Ebitda of between A$7.8 billion and A$8.0 billion in fiscal 2023, when it sees total income of between A$23.0 billion and A$25.0 billion. It anticipates capital expenditure of A$3.5 billion-A$3.7 billion.

Fiscal 2022 sales income edged 1.3% lower to A$21.28 billion, compared with an average analyst forecast of A$21.8 billion. Mobile income rose 1.7% to A$9.47 billion as Covid-driven restrictions on movement were relaxed, although fixed-line consumer and small-business income fell by 5.3% to A$4.49 billion.

Chief Executive Andrew Penn, who will retire this month after more than seven years in charge, said the increased dividend reflected the company's confidence that it can achieve high-teens earnings-per-share growth through its 2025 fiscal year.

Chief Financial Officer Vicki Brady, who led Telstra's consumer and small business operations before becoming CFO in 2019, will be the new CEO.

Mr. Penn led Telstra through the rollout of the government-owned National Broadband Network, which reduced incumbents' earnings from fixed-line services. Mr. Penn said the company was nearing the end of the multi-year period in which the NBN dragged.

He oversaw a company-wide restructure that included cutting headcount and costs, and a near-complete separation of Telstra's various operations into standalone units. Telstra already sold a 49% stake in its mobile infrastructure, raising an above-expectation 2.8 billion Australian dollars (US$2.10 billion).

Shares in Telstra hit a near five-year high in January before cooling amid the global downturn in equities. The stock last traded at A$4.01 and the average analyst price target is A$4.65, according to data compiled by FactSet.


Write to Stuart Condie at stuart.condie@wsj.com


(END) Dow Jones Newswires

08-10-22 1845ET