Vital Limited Analysis

Overview

Vital is the provider of fundamental nationwide infrastructure and communication services that are Vital to New Zealand. We have been providing connected, seamless, integrated communications and coverage in New Zealand's most remote locations for over 25 years. We own and operate fibre in Auckland and Wellington positioned to take advantage of growing data consumption, are the largest commercial provider of nationwide radio in New Zealand and provide linking radio services through microwave to some of the remotest parts of New Zealand.

We serve many customers across New Zealand including; Government, Civil Defence, Emergency Services, Health, Utilities, Public Transport, Education, Logistics & Freight, Agriculture and Channel partners.

We look forward to providing Vital services for another 25 years.

Vital is the new name of TeamTalk and CityLink.

Performance

The following information was extracted from Vital Limited's Half year report, released 26 February 2025

Financial Performance

Vital Limited (“VTL” or “Company”) reported a net loss after tax of $0.54 million for the first half of FY25 versus a net profit of $0.05 million in the prior financial year period. The result includes an after-tax lease adjustment accounting loss of $0.11 million (prior period included a loss of $0.10 million), so the adjusted result for the interim period was a net loss of $0.43 million.

Key factors driving the result were lower Fibre revenues reflecting difficult economic conditions for customers, higher labour expense (resulting from lower levels of labour capitalisation) and higher Other costs from cost of goods associated with increased Hardware and Installation revenue.

• Economic conditions putting downward pressure on revenues
• NPAT loss of $0.54m versus profit of $0.05m for same prior year period
• Adjusted EBITDA of $2.4m down 24.2% on same prior year period
• Operating costs up slightly to $0.22m (2.2%) on same prior year period, reflecting increased cost of new sales
• Wireless channel strategy delivering solid sales results - e.g. Fonterra
• Wired customer wins more than offset by shrinking public sector economy
• Major customer win (Transpower) to benefit earnings from FY26
• Vital gaining leadership position in Utilities managed services
• FY25 guidance on track, albeit economic uncertainty remains high, and may soften to the lower half of the range
• NPS up to +41, eNPS +34