Spark New Zealand Limited · NZX:SPK
Spark New Zealand — FY2025 Earnings Presentation
40 slides from Spark New Zealand's earnings presentation, Aug 20, 2025
Slide 1: Spark New Zealand FY25 Results Summary
Spark New Zealand FY25 Results Summary Jolie Hodson, Chief Executive Officer Stewart Taylor, Chief Financial Officer 20 August 2025
Slide 2: Disclaimer
Disclaimer The information in this announcement has been prepared by Spark New Zealand Factors that could cause actual results or performance to differ materially from those expressed Limited. or implied in the forward-looking statements include the outcome of Spark New Zealand’s anticipated revenue
Slide 3: FY25 results summary
FY25 results summary FY25 Guidance FY25 Outcome Adjusted FY25 result within updated guidance EBITDAI $1,040m-$1,100m $1,060m Stabilising our performance Capex ~$415m - $435m $429m Dividend 25.0 cps 25.0 cps 1 Market momentum in core business Significant transformation on track 2 Simplified portfolio
Slide 4: FY25 financial snapshot
FY25 financial snapshot Adjusted revenue (1)(3) Adjusted EBITDAI (3) (4) Adjusted NPAT (3) $3,700 million $1,060 million $227 million 4.2% decrease vs. FY24 8.9% decrease vs. FY24 33.6% decrease vs. FY24 Reported revenue (2) Reported EBITDAI (2) (4) Reported NPAT $3,725 million $1,053 million $260 m
Slide 5: Significant transformation on track
Significant transformation on track We have taken action to transform our business and cost base – with more still to do What we said we would do What we’ve done so far See slides • Grew consumer and SME pay monthly connections and ARPU (when excluding Telco core impact of insurance) 7-11 Drive mome
Slide 6: New five-year strategy
New five-year strategy Refocusing on our core connectivity business to grow competitive advantage and shareholder returns See slides 30-35 for strategy summary Spark FY25 Results Summary 06
Slide 7: Connectivity is our core business
Connectivity is our core business Mobile and connectivity is central to growth and our priority for investment 5% 5% 15% 25% In FY25 connectivity contributed: 70% Mobile 80% Mobile 40% revenue gross margin 52% 28% Mobile 30% Other connectivity1 Cloud and IT Data centres (1) Other connectivity includ
Slide 8: Mobile performance overview
Mobile performance overview Performance impacted by removal of insurance and price competition in E&G and consumer prepaid, while pay monthly remains strong Consumer and SME Pay Monthly FY24 FY25 % change Increasing ARPU excluding insurance, combined with modest connection growth • Connection growth
Slide 9: Market growth improving and Spark growing in H2
Market growth improving and Spark growing in H2 Spark remains the #1 provider by some distance, with positive momentum as market growth improves MVNO 1.9% (+0.4%) Total mobile market performance (1) • Total FY25 mobile market growth was 1.2%, lower than IDC estimated growth of 3% (2) • Second half g
Slide 10: Driving mobile momentum into FY26
Driving mobile momentum into FY26 Initiatives implemented in FY25 are lifting performance into FY26 Q1 Consumer Pay Monthly Consumer Prepaid Enterprise and Government Focus: driving connection and ARPU growth with Focus: maintain stable ARPU, while upweighting Focus: hold customer base, and compete
Slide 11: Connectivity and IT performance summary
Connectivity and IT performance summary Broadband revenues stabilised, public cloud continued to grow, IT services remained challenging Connectivity FY24 FY25 % change • Broadband connections declined 3.8% in a low-spend environment – focused on increased bundling with mobile in FY26 to support volu
Slide 12: Review of non-core assets completed
Review of non-core assets completed Targeted divestments completed or underway to simplify portfolio and further strengthen the balance sheet Asset Outcome Shareholdings • Sale of remaining stake (~17%) to global investment group CDPQ for $309 million net of transaction costs Connexa • Valued Connex
Slide 13: New technology delivery model introduced
New technology delivery model introduced Leveraging four strategic global partnerships to transform cost base and customer experiences Technology layer Strategic partner Reduces network operating costs while accelerating AI and automation capabilities for better customer experiences Network Provides
Slide 14: Spark a leader in AI and automation capability in New Zealand
Spark a leader in AI and automation capability in New Zealand Capability accelerating with agentic AI and global partnerships, supporting cost-out and customer experience Strategy Responsible Data Predictive models High-value Enterprise-wide Global and talent AI capability and Gen AI use cases tech
Slide 15: Expanded cost reduction programme on track
Expanded cost reduction programme on track $85m reduction in H2 25 delivered through labour, other opex, and product costs reductions FY25 labour and opex reduction FY26 labour and opex reduction • At H1 25 Spark communicated an expanded cost-reduction target of • FY26 targeting $30m-$50m net labour
Slide 16: Sustainability performance continues to mature
Sustainability performance continues to mature Spark remains committed to its FY30 SBTi1 emissions reduction target and is taking meaningful steps to work towards it Rising national grid emissions factor contributed to FY25 emissions increase • Underlying performance improvements, with electricity c
Slide 17: Data centre strategy update
Data centre strategy update Spark FY25 Results Summary
Slide 18: Agreement reached to sell a 75% stake in data centre business
Agreement reached to sell a 75% stake in data centre business Spark continues to participate in high growth market through retained 25% stake High quality data centre partner secured • Pacific Equity Partners (PEP) has joined Spark as an investment partner for its data centre DC Co – transaction fea
Slide 19: DC Co has a leading New Zealand data centre platform
DC Co has a leading New Zealand data centre platform Market continues to grow as cloud and AI uptake increases demand for data storage and compute in New Zealand Leading Significant Attractive Track record of High quality Strong focus on New Zealand data development market dynamics securing global c
Slide 20: Data centre business continued to grow in FY25
Data centre business continued to grow in FY25 Development pipeline increased to 130MW+ and revenue and margin grew through scaling utilisation and new customer wins Overall performance FY24 FY25 % change • Continued revenue growth, with high levels of utilisation at 88% Revenue (1) (2) $45m $50m 11
Slide 21: Capital management reset
Capital management reset Spark FY25 Results Summary
Slide 22: Capital management reset
Capital management reset Renewed capital management discipline Maintaining financial strength • Focused on a strong balance sheet, targeting metrics consistent with current credit rating Investment and portfolio management • Investments and M&A for growth must meet Spark’s hurdle rates (see followin
Slide 23: Capital allocation for shareholder value creation
Capital allocation for shareholder value creation Updated Capital Management Framework introduced for FY26 onwards Capital Management Framework Maintaining financial strength 01 Focused on a strong balance sheet, targeting metrics consistent with current credit rating Investment and portfolio manage
Slide 24: Financial summary
Financial summary Spark FY25 Results Summary
Slide 25: FY25 financial summary
FY25 financial summary REPORTED1 REPORTED1 CHANGE ADJUSTED2 ADJUSTED2 CHANGE FY24 FY25 FY24 FY25 Operating revenues and other gains 3,820 3,725 (2%) 3,861 3,700 (4%) Operating expenses (2,679) (2,672) 0% (2,698) (2,640) 2% EBITDAI 1,141 1,053 (8%) 1,163 1,060 (9%) Net financing cost (114) (118) (4%)
Slide 26: FY25 financial summary
FY25 financial summary FY25 adjusted EBITDAI of $1,060m within updated guidance Reported result Adjusted result • Reported revenue and EBITDAI exclude the data centre business, • Adjusted revenue and EBITDAI include the data centre business, and exclude classified as a discontinuing operation; and i
Slide 27: Capital expenditure
Capital expenditure Disciplined capital spending in FY25 • $429m of total capex in FY25 is 17.2% lower than FY24 and represents Spark CAPEX 11.6% of adjusted revenue – within 10%-12% target range Maintenance Growth Spectrum • Capital expenditure in FY25 included: $600m $23m o Continued investment in
Slide 28: Free cash flow
Free cash flow Impact of lower EBITDAI offset by lower cash maintenance capex • FY25 FCF of $330m is steady on FY24, as maintenance capex was FY24 FY25 Change Change reduced to offset EBITDAI reduction Adjusted free cash flow calculation ($m) ($m) ($m) (%) • As outlined on slide 22, in future years
Slide 29: Debt and dividends
Debt and dividends FY25 net debt reduced through Connexa proceeds, with further improvement to come from FY26 transactions • At 30 June 2025 net debt at hedged rates was $1,475m: o Based on gross debt at hedged rates of $1,509m and cash Spark Debt Profile of $34m Net debt ex leases Leases Net Debt/E
Slide 30: SPK-30 Strategy
SPK-30 Strategy Spark FY25 Results Summary
Slide 31: Spark FY25 Results Summary
Spark FY25 Results Summary 31
Slide 32: Spark FY25 Results Summary
Spark FY25 Results Summary 32
Slide 33: Spark FY25 Results Summary
Spark FY25 Results Summary 33
Slide 34: Spark FY25 Results Summary
Spark FY25 Results Summary 34
Slide 35: Spark FY25 Results Summary
Spark FY25 Results Summary 35
Slide 36: Outlook and guidance
Outlook and guidance Spark FY25 Results Summary
Slide 37: FY26 Guidance
FY26 Guidance (1) FY25 Actual FY26 Guidance FY26 Guidance (incl. data centres) (3) (excl. data centres) (4) Adjusted EBITDAI $1,060m(2) $1,020m - $1,080m $1,010m - $1,070m Total capex $429m FY26 onwards – new definitions of capex listed below BAU capex - $380m - $410m $380m - $410m Strategic capex (
Slide 38: Appendix
Appendix
Slide 39: FY25 reported and adjusted earnings reconciliation
FY25 reported and adjusted earnings reconciliation • The data centre business has been classified in the Financial Statements as a discontinuing operation held for sale at 30 June 2025 in accordance with the requirements of NZ GAAP. As a result, the revenue and expense items for both FY25 and FY24 h
Slide 40: FY25 debt key metrics
FY25 debt key metrics FY24 H1 25 FY25 Net debt ($m) ($m) ($m) Net debt at hedged rates $1,636 $1,796 $1,475 Net debt at hedged rates including lease liabilities1 $2,438 $2,735 $2,392 Debt ratios Borrowing costs (annualised) 6.4% 5.6% 5.6% Weighted average debt maturity (years) 3.7 years 3.1 years 3.