Telstra Boosts Dividend as First-Half Earnings Rise 5.5% — Update

By Stuart Condie

SYDNEY--Telstra declared a larger-than-expected dividend and increased the size of its on-market share buyback after the Australian telecommunications company's first-half underlying earnings rose by 5.5%.

Australia's largest telco on Thursday reported underlying earnings before interest, tax, depreciation and amortization for the six months through December of 4.19 billion Australian dollars, equivalent to about US$2.97 billion.

That compared with A$3.97 billion a year earlier, which was adjusted for one-off items such as divestments and restructuring costs.

Net profit rose by 9.4% to A$1.12 billion and total income grew 0.2% to A$11.85 billion. The average analyst forecast had been for a A$1.10 billion net profit from total income of A$11.82 billion, according to data compiled by Visible Alpha.

Telstra raised the ceiling on the share buyback it announced in August to A$1.25 billion, from A$1 billion. It said the move was supported by earnings growth and the strength of its balance sheet, which has been boosted in recent years by asset sales.

It also raised its interim dividend to A$0.105 a share, from A$0.095 a year ago. That was stronger than most analysts had been expecting, with forecasts split between Telstra holding its dividend or raising it to A$0.10.

Telstra said it completed A$637 million of August's buyback during the December half. That program came on top of a A$750 buyback it completed in June.

The rise in first-half earnings was supported by stronger mobile revenue on higher pricing and 3.6% growth in services in operation to 25.5 million. Its mobile unit reported 3.6% Ebitda growth, in line with its rise in revenue.

Underlying operating expenses fell 2.4%, which Chief Executive Vicki Brady said more than offset pressure from rising costs. Telstra cut 1,033 roles over the half year, taking the on-year fall in employee count to 2,356, or 7.4%.

Telstra tightened its guidance range for full-year Ebitda to between A$8.2 billion and A$8.4 billion, excluding lease amortization.

It previously guided for underlying Ebitda of A$8.15 billion and A$8.45 billion.

Telstra's stock is rated either a buy or hold by every analyst monitored by Visible Alpha even after the buybacks helped increase its price by more than 40% since mid 2024.

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

(END) Dow Jones Newswires

February 18, 2026 16:52 ET (21:52 GMT)