SPK - Spark New Zealand

[Ann]

I have chosen this for the January Tipping Contest. However I think there is a bearish Head and Shoulders forming which is not so good for a Tipping Contest. However I am not basing my Tipping choices for a win but merely to display what I feel is a good reliable stock, which could live in a portfolio for a long time. I have held this stock in the past and it eventually closed itself out. Up to this date I have never re-entered a stock after being closed out. This was a very good stock to me and made me money. I may well re-enter if I can get it at a much better price than it is now. I will have to wait and see what price tempts me to re-enter.

 

[Darc Knight]

You were so kind to "help" me with my December stock pick @Ann I feel it only fair I help you with yours.

I took a look at this and noticed a strong and continued upwards trend suggesting continued growth in price. It has, since last Wednesday taken a dive though indicating NOW is the time to buy this stock. Waiting to buy will only see you paying a lot higher price.

 

[Darc Knight]

.

View attachment 90812

The more one looks at that chart and notices the upward trend with the current dip, the more one thinks NOW is the time to buy this Stock rather than waiting until next month

 

[Ann]

You were so kind to "help" me with my December stock pick @Ann I feel it only fair I help you with yours.

I took a look at this and noticed a strong and continued upwards trend suggesting continued growth in price. It has, since last Wednesday taken a dive though indicating NOW is the time to buy this stock. Waiting to buy will only see you paying a lot higher price.

It was a pity WSI was your pick DK, I always feel a quandry as to what to do when I see a situation which needs to be addressed. Throughout life there are so many ethical questions even in small ways. Should I act/say something/warn someone. It can be a very hard thing. Although I had no problem attacking PO3 as hard as I did as I could see the poster was using ASF as a dumping ground for his worn out crap.

You may be right about buying SPK now DK. It has survived a triple top with great robust.
However, as much as I may be a chartist, I also like to ask why something happens to a stock. This is so, so easy to answer when one can chart. Go to the date of a point of a big change, look up the announcements and bingo you have your answer. So let's look at why it took off after its triple top. On October the 26 it took off after it was in a fall from its triple top...."what happened?" she asked. On October 23 a guy by the name of Matt Bain joined the company as Marketing Director and introduced a whole new culture of employment there called 'Agile Model'. This is along the lines of how other major tech firms work. It gives employees the opportunity to work when where and how they please.
http://stoppress.co.nz/movingsshakings/matt-bain-join-spark-marketing-director

OK, I get this and the excitement but it is not instantaneous and shouldn't drive a price to that extent maybe it did. I like the man's looks and work philosophy. Not too old, not too young and he looks focused.

However as I am seeing a head and shoulders and I have seen many, many of those, I look back on the chart to see if it is in an all time high, as unless a H+S pattern is at an all time high it is unlikely to resolve in a textbook manner.

I see it is coming up to an all time double top from back in March 2005 of around $4.50, so there is not a whole lot of up space left before a major challenge of a double top. Now what else is currently happening to SPK? From December 18 Vanguard have been buying into this stock they now own 5.210%. This will have been lifting the price with the demand. Not for a second suggesting they were running the price up, just buying into a company without a whole lot of noise.

So another look at the chart and the MACD signal I can see this appears to be in a cross back mode. The chart pattern of a near top H+S, the MACD signal of a cross down, the potential of a long term double top coming from the early days at around $4.50, the current weakness in the world markets, the current sell off of Vanguard ETFs all leaves me slightly less than confident SPK will go up. It may go up, I may well be wrong, I am always open to that chance. I think a lot of buying support will disappear from this stock as people like what they see, and stand back for the sales to happen if we are indeed in another Kondratieff Wave, there will be some great buys coming up and I am all cashed up and waiting.

I will be using the Tipping Comp to look for stocks. This time using the Tipping Comp as my theme. Heaven only knows what I may buy. Shock and horror, I may even buy a miner.....aka a big hole in the ground. Hope it isn't full of bullsh!t. Never mind, I am a vegetable gardner, I know manure when I smell it!

Now DK, I would like a list of all your justifications for your stance in your very emphatic bullish recommendations on SPK and why you believe it will go up. Don't give me wishful thinking, it doesn't cut it.

...and the inevitable chart...

 

[Darc Knight]

Geez @Ann it took off again mid week, but seems to have taken another dive yesterday. Monday might be a good buy? Buy in December and sell in January when it reverts back to it's upwards trend.

 

[Ann]

Let's see how this goes over February for the Tipping Comp. It has cleared a short term overhead falling resistance, and bounced off a short term support of 3.74. I will chart it tomorrow.

 

[Ann]

A two month end-of-day daily chart showing it breaking above a falling resistance line. It has bounced off a short term support of 3.74. It has offered a second point to draw a rising support. The PVI (Positive Volume Index) is still rising, telling me the punters are still liking this stock. It may or may not find strength with this support, let's see what happens.

 

[Trav.]

Potential long entry for me over the next couple of days, as good stopping volume today and looking for conformation now.

 

[Trav.]

Well who would have thought that yesterdays little gain 2% would lead to a price sensitive announcement today

It is amazing what can happen...Will be interesting to see how SP opens but no amount was mentioned in the sale of the business

holding

 

[Trav.]

still holding for the time being and nice to see this heading up.

follow up from post #28

 

[rnr]

SPK looks adequately set to challenge the overhead resistance from early September 2019.

 

[Trav.]

View attachment 99586

SPK looks adequately set to challenge the overhead resistance from early September 2019.

I was also looking to see how much more it had in it as I was worried it might run out of steam.

Recent resistance is a you highlighted but looking back a bit further we have similar levels in early 2005, so maybe this point is pretty significant.

Market looking good so a good chance to take it out.

 

[Joules MM1]

comp entry, choice !
like most stocks this week that are on a decent daily incline SPK got hit with the panic du jour, a small rally is due, give a day or two, 13 week TMF hald above zero, retail fell thru zero, cracked the ice and currently drowning in a sea of frozen fear, so if the stock is green at the end of march it'll be a good sign the trend remains in tact, an across-the-board shake-up comes with excuses not because of excuses, in that respect the stock remains healthy for mine

looking for a bounce (then a follow-on trounce, maybe next month)
View attachment 100900

 

[divs4ever]

Spark delivers strong first half performance and announces plans to establish Spark TowerCo

• Strong half year performance with revenue1, EBITDAI2, and NPAT all in growth
• Mobile a standout, with Spark the fastest growing provider by connections and revenue year-on-year3
• H1 FY22 dividend of 12.5 cents per share declared, 100% imputed
• Plans to establish Spark TowerCo to drive improved utilisation and capital efficiency of passive mobile
assets, and create opportunities to introduce third-party capital
Spark New Zealand (Spark) today announced a strong H1 FY22 result, with revenue, EBITDAI, and NPAT all
in growth.
Revenue increased 5.2% to $1,890 million, driven by a standout performance in mobile. Spark was the fastest
growing NZ mobile provider by connections and revenues year-on-year3, with mobile service revenue up 5%.
A successful launch of simplified broadband plans stabilised Spark’s base at 702,000 connections. While
broadband revenue fell 3.9% in a highly competitive market, gross margin was maintained as the benefits of
wireless broadband (WBB) growth offset increased fibre costs.
Cloud, security, and service management revenues grew 3.2%, driven by demand for public cloud and growth
in the health sector.
Spark’s investment behind future markets continued to gain momentum. Spark IoT connections increased 31%
to 623,000, supporting strong revenue growth; Spark Health won the first national contract for digital services
under the newly established Health New Zealand and grew revenues 25%4; and Spark Sport grew revenues
despite the sporting calendar being significantly impacted by Covid-19.
Growing revenues drove a 7.6% increase in EBITDAI to $538 million. NPAT increased 21.8% to $179 million,
driven by EBITDAI growth, a reduction in finance expense and lease liability interest, and lower depreciation
and amortisation.
Spark declared an H1 FY22 dividend per share of 12.5 cents, 100% imputed, supported by free cash flow of
$183 million.
Spark New Zealand Chair Justine Smyth said: “While we continued to experience ongoing disruption from
Covid-19 during the half, Spark delivered strong revenue and profit growth, with a standout performance in
mobile, a stabilisation in broadband, and continued business digitisation driving cloud adoption.
“We are pleased to see the strategic ambition Spark set back in 2020 coming to fruition, with future markets
now making a significant contribution to revenue growth, and targeted investments in simple, digital customer
experiences, data and artificial intelligence, and critical infrastructure differentiating Spark in the market.
“The Board and I are particularly pleased to see this growth driven by highly engaged people – with Spark
achieving its highest employee engagement to date during the half.
“A number of infrastructure investments are progressing to plan and supporting future growth, and in the
second half Spark intends to establish Spark TowerCo to improve the utilisation and capital efficiency of its
passive mobile assets and open up opportunities to introduce third-party capital.”
1 Operating revenues and other gains
2 Earnings before finance income and expense, income tax, depreciation, amortisation and net investment income (EBITDAI) is a non-Generally Accepted Accounting
Practice performance measure that is defined and reconciled to net earnings in Spark New Zealand’s Financial Statements 3 Market share estimates sourced from IDC
4 Revenues grew 51% including procurement
Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand
Spark expects to be around the top half of its FY22 EBITDAI guidance range of $1,130 million to $1,160 million
and confirmed total FY22 dividend guidance of 25.0 cents per share, 100% imputed5.
Reflecting on the half-year results and Spark’s progress executing its three-year strategy, Spark CEO Jolie
Hodson said: “Despite closed borders keeping roaming revenues suppressed, we delivered a market-leading
mobile performance3, underpinned by precision marketing and increasing customer demand for data, with 48%
growth in our Endless plans year-on-year.
“We have stabilised our broadband connection base with the launch of a simpler broadband line-up and
maintained margins in a highly competitive market with continued growth in wireless. We are building on this
momentum with further competitive wireless broadband offers launched in the second half.
“While we saw continued growth in cloud, security, and service management revenues, it was lower than where
we want it to be, with the shift in portfolio mix towards public cloud continuing to put pressure on pricing. Our
service management growth trajectory was also impacted by access to client sites due to Covid, however our
second half pipeline remains strong.
“As we execute our three-year strategy, it is pleasing to see our focus on building core capabilities delivering
differentiation in the market. Our customer experiences are increasingly digital, and our simplification
programme is progressing to plan. Precision marketing is delivering a 16% uplift in conversion, we are
accelerating our shift from legacy to modern technology, and we are building a world-class culture.
"We are on track to deliver our overall FY23 future market revenue aspirations, and while Spark Sport’s
contribution will be lower than expected, it is offset by the strong growth we are experiencing in health and IoT.
“As New Zealand’s healthcare sector digitises, Spark Health goes from strength to strength, and with our digital
health platform ‘Kete Waiora’ targeting customer onboarding by the end of FY22, we expect this to continue.
Spark IoT is also poised to continue its strong revenue and connection growth as customers look to utilise the
power of technology to drive efficiency and grow their business.
“None of these results would be possible without the mahi of our people, and we remain focussed on investing
in their learning and development, their wellbeing, and creating a place where all our people feel they belong.”
Spark TowerCo subsidiary announced
During FY21 Spark conducted a review of its infrastructure portfolio, to focus effort and investment on its
strategically important assets. Since that time Spark has announced an accelerated 5G rollout, delivering 90%
population coverage by the end of 20236, a material upgrade of its Mayoral Drive Exchange to support multiaccess edge compute capability, and a significant increase in capacity at its Takanini Datacentre – with up to
8MW now contracted and construction of a new data hall underway.
Today Spark announced plans to establish Spark TowerCo as a subsidiary company, to improve the
performance, utilisation, and capital efficiency of its passive mobile assets – spanning ~1,500 mobile sites7.
Hodson continued: “We can see globally that shared ownership models are an effective way of improving
returns from infrastructure assets that are not critical to competitive advantage. In mobile, our active assets are
what drives our competitiveness – including our core network and radio equipment. These assets leverage our
spectrum holdings, provide differentiated customer experiences, and support our wireless aspirations.
“Our passive mobile assets, on the other hand, are the physical towers that support this active equipment. By
separating these assets into a subsidiary model, we can improve utilisation through coverage expansion, future
service innovation, and increased tenancy, while delivering efficiencies in build, maintenance, technology, and
lease costs as we expand mobile coverage across Aotearoa.”
5 Subject to no adverse change in operating outlook
6 Assuming spectrum is made available by the New Zealand Government
7 Approximately 250 sites relate to outbound co-location on third party owned infrastructure (e.g., Rural Broadband Initiative (RBI) 1 sites)
Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand
Spark intends to commence a process in the second half of FY22 to explore the introduction of third-party
capital into Spark TowerCo, however there is no certainty that a transaction will proceed.
“Should we choose to introduce third-party capital we will retain a shareholding and remain a key anchor
tenant, with appropriate agreements in place on arms-length terms for operations and services. There will be
no change for our customers, and we will continue to invest in modernising our mobile network and improving
coverage for Aotearoa.”
Spark will provide more information on Spark TowerCo in the second half of FY22.


==============================================================

( DYOR )

i hold SPK

 

[divs4ever]

Spark announces sale of 70% of TowerCo business for
$900 million
Spark New Zealand today announced the Ontario Teachers’ Pension Plan Board (“Ontario
Teachers’”) will acquire a 70% interest in its TowerCo business.
Spark’s TowerCo business (“TowerCo”) is a leading New Zealand towers business with
approximately 1,263 sites. The transaction values the business at $1.175 billion, representing a
FY23 pro-forma EBITDA multiple of 33.8x1.
Spark expects net cash proceeds2 of $900 million at completion, which is subject to Overseas
Investment Office approval, and is anticipated to occur in the first half of FY23.
Under the terms of the deal, Spark has entered into a 15-year agreement with TowerCo (plus
rights of renewal) to secure access to existing and new towers, with a build commitment of 670
sites over the next 10 years.
Spark New Zealand Chair, Justine Smyth said: “The establishment of TowerCo will accelerate
Spark’s strategic objective of delivering a smart, automated network, while maximising value for
shareholders. The transaction will deliver proceeds of $900 million, enabling direct shareholder
returns and investment in future growth opportunities that will accelerate Spark’s transition from
traditional telecommunications to higher growth digital services.
“Spark intends to release an updated capital management policy at its full year results on August
24. When assessing the most appropriate use of proceeds Spark will consider three key pillars –
maximizing returns to shareholders, investment in future growth, and maintaining financial
flexibility through an appropriate investment grade debt rating. The capital management policy
will provide clarity on the proportion of proceeds allocated to each of these areas and the most
effective means of returning proceeds to shareholders.”
Spark CEO Jolie Hodson said the Company saw a high level of market interest in its passive
mobile assets: “We are pleased to have formed this strategic partnership with Ontario Teachers’
– a high-calibre investor with a long-term partnering focus and significant experience managing a
portfolio of infrastructure investments globally, including within Australia and New Zealand.
“Our intention in establishing TowerCo is twofold – it allows us to deliver better outcomes and
service experience for our customers and Aotearoa through faster, more efficient deployment of
digital infrastructure, and it better realises the value of our passive mobile assets, maximising
value for shareholders and enabling us to invest in future growth opportunities.
“A standalone TowerCo business with sole responsibility for passive mobile infrastructure will
have a single-minded focus, delivering efficiency, service innovation, and improved speed to
market. This is going to be particularly important when you consider the 5G build programs of
tomorrow will be very different to the 4G ones of the past, requiring many more, smaller sites,
closer to the customer, and greater overall densification.”
Bruce Crane, Senior Managing Director and Head of Asia Pacific Infrastructure & Natural
Resources at Ontario Teachers’ said: “The acquisition of a 70% stake in TowerCo is an ideal fit
1 Assumes FY23 EBITDA of NZ$34.8 million as at 30 June 2023.
2 After transaction costs

for our growing global portfolio of high-quality infrastructure assets. This investment builds on our
long track record of investing in superior businesses in New Zealand and will draw on our deep
experience investing in digital infrastructure businesses globally. We look forward to working with
the Spark New Zealand team to build and grow a leading business that will enable New
Zealanders’ continued access to critical telecommunications services to meet their growing
mobile demand needs over the long-term.”
Spark will continue to determine how its mobile network is developed, including where and when
capacity investments occur, with TowerCo then designing and deploying these build
programmes.
Jolie continued: “As part of the deal, we have committed a substantial build programme to
TowerCo, with 670 sites to be built over the next decade. This is a significant investment in the
digital infrastructure that will underpin the growth of our digital economy and enable businesses
in Aotearoa to innovate and grow.
“Spark is the anchor tenant and retains a 30% stake in TowerCo, ensuring we are a key strategic
partner as the business grows. We will also continue to own all the ‘smarts’ of our network – such
as radio equipment and spectrum – which is what drives our competitive advantage and
differentiation in the market.”
Authorised by:
Alastair White
GM Capital Markets


==============================================================



i hold SPK

 

[divs4ever]

Spark announces first half results with new strategy delivering adjusted revenue and EBITDAI growth
• Growth in adjusted1 revenue and EBITDAI2 underpinned by strong performance in mobile and momentum in data centres and high-tech.
On a reported basis revenue and EBITDAI declined as Spark cycled the significant net profit declared in FY23 following the TowerCo and Spark Sport transactions
• NPAT3 decreased on an adjusted basis by 4.8% to $157 million
• H1 FY24 dividend of 13.5 cents per share declared, 100% imputed
• Reaffirmed FY24 EBITDAI, capital expenditure, and total dividend guidance

Spark New Zealand (Spark) today announced its H1 FY24 result, with adjusted revenue and EBITDAI growth against the backdrop of a challenging economic environment. Spark Chair Justine Smyth said, “The first half of FY24 was characterised by high inflation and cost of living pressures, which flowed through to lower levels of consumer and business confidence.
While Spark’s products are largely resilient to economic downturns, they are not immune, and we saw weaker demand in some areas of the business.
“Despite these challenges Spark continued to deliver top-line growth1 and has made solid progress implementing its new three-year strategy, with cornerstone digital infrastructure investments in data centres and 5G Standalone progressing to plan.
With the ongoing exponential growth in data, businesses digitisation and cloud adoption, and the rapid uptake of generative AI, demand for data centre capacity is accelerating, and Spark is well positioned to capture its share of this growing market.
“The Board is pleased to continue delivering returns to shareholders, with $305 million in TowerCo proceeds returned to date through our on-market share buy-back and a first half dividend of 13.5 cents per share declared, 100% imputed.”
H1 FY24 operating performance Reported revenue declined 22% to $1,976 million, reported EBITDAI declined 49.1% to $530 million, and reported NPAT declined 81.8% to $157 million, as Spark cycled the significant revenue and net profit declared in FY23, following the TowerCo and Spark Sport transactions.
When adjusting for the one-off benefit in FY23, revenue increased 1.3% to $1,976 million, driven by ongoing strength in mobile, momentum in data centres and high-tech, continued stabilisation in broadband, and a return to growth in cloud. When combined with strong cost control holding operating expenses broadly flat, adjusted EBITDAI grew 3.9% to $530 million.
Adjusted NPAT decreased 4.8% to $157 million, due to a higher interest cost on debt and leases, with second half improvement expected in line with a stronger H2 EBITDAI4 . 1
H1 FY23 EBITDAI is adjusted for the impact of the TowerCo gain on sale of $584 million included in revenue and the Spark Sport provision of $52 million included in operating expenses, which resulted in a net EBITDAI impact of $532 million.
NPAT is further adjusted for tax effect of the net gain on sale of the TowerCo transaction and the Spark Sport provision totalling $168 million. 2
Earnings before finance income and expense, income tax, depreciation, amortisation, and net investment income (EBITDAI) and capital expenditure (Capex) are non-Generally Accepted Accounting Principles (non-GAAP) performance measures that are defined in note 2.5 of Spark’s Annual Report 3
Net Profit After Tax 4 In line with FY24 guidance
Spark maintained its market leading position in mobile5 , with mobile service revenue increasing 6.3% to $510 million as the benefit of price increases flowed through and connection growth continued.
Broadband revenue remained broadly stable at $309 million, despite high levels of price competition in an inflationary environment.
In digital services, Spark stabilised its IT market performance, while driving new growth in data centres and high-tech solutions6 . Interventions to improve IT product performance delivered 3.8% growth in cloud revenue, with increased private and public cloud workloads and the launch of a new hybrid cloud service, CloudIQ.
Cloud gross margin grew 7.6% as the cost base was reset, with benefits to continue flowing through in the second half.
Overall IT revenues held flat at $345 million, impacted by a slowdown in service management, primarily driven by lower public sector demand. Spark’s 10MW expansion of its Takanini data centre completed in August 2023, with revenue coming online during the half and driving a revenue increase of 38.5% to $18 million.
Spark has a strategic ambition to establish three large-scale data centre campuses in Auckland, supported by a network of regional data centres across the country.
In line with this objective, Spark has reached conditional agreement to purchase land within a new development on Auckland’s North Shore, where it intends to develop an initial 10MW hyperscale data centre campus, with the option for further expansion.
High-tech revenues7 grew 12.9% to $35 million, driven by significant growth in IoT connections.
Digital health revenues reduced 8.7% to $42 million, as public sector activity remains subdued.
Commenting on the half-year results, Spark CEO Jolie Hodson said, “Mobile remains central to our growth, with service revenues up over 6% and Spark capturing 47% of total mobile connection growth in the half8 .
We have maintained broadband revenues and margin despite high levels of price competition in an inflationary environment, and now have 31% of our customer base on wireless.
We have also returned cloud to growth through the successful launch of our new hybrid cloud proposition CloudIQ, with margin benefits flowing through from our cost base reset.
“In an inflationary environment we must remain focussed on disciplined cost control, and as we implement our new strategy we are creating a more efficient, low-cost operating model to ensure we can continue to invest in our growth ambitions.
“Our digital infrastructure investments into data centres and 5G Standalone are progressing at pace.
These investments underpin ongoing strength in our core business and new high-tech commercialisation opportunities that will build our growth engines of the future.
“We completed a 10MW expansion at our Takanini data centre site and we are now planning to invest in a new hyperscale data centre campus on Auckland’s North Shore, as demand for capacity continues to grow.
High-tech revenues increased off the back of strong IoT connection growth, with our IoT networks now supporting over 1.8 million connections.
“I am particularly pleased that our business fundamentals remain healthy and growing – with customer satisfaction up five points, people engagement up three percentage points, and Spark maintaining its position in the Dow Jones Sustainability Australia Index.
As always, I would like to recognise our Spark whānau for all their hard work and continued commitment to supporting our customers and our business ambitions.
” FY24 guidance Spark remains committed to delivering its FY24 guidance, subject to no material adverse change in operating outlook: 5

Market share estimates sourced from IDC as at 31 December 2023 6 H1 FY23 reported NPAT is restated for the final tax calculation on the sale of Connexa Limited as described in Note 2 of the Interim Financial Statements 7 Excluding health 8 Market share estimates sourced from IDC as at 31 December 2023

• EBITDAI: $1,215 million -$1,260 million
• Capital expenditure: ~$510-$530 million
• Total dividend per share: 27.5 cents per share, 100% imputed

Authorised by: Chante Mueller Head of Investor Relations & Insurance

i hold SPK

i bought in sub $2.50

am not so sure i would be buying in at current prices when they are busy flogging off assets and doing buy-backs

 

[divs4ever]

Spark reduces FY24 EBITDAI guidance as tough trading conditions intensify

Spark New Zealand (Spark) today announced it is reducing FY24 EBITDAI guidance from $1,215-$1,260 million to $1,170-$1,210 million, as challenging trading conditions intensified in some parts of the business.
There is no change to FY24 capital expenditure and dividend guidance.
At Spark’s first half results the Company noted weaker demand in the enterprise and government market, which impacts Spark’s IT revenues.
Since the half, public and private sector spending cuts have deepened, and Spark has seen significantly reduced demand in IT service management and professional services and delays to planned digital transformation projects.
At the same time, while mobile service revenue and broadband performance remains in line with expectations, sales of mobile devices and accessories have been softer than expected as high interest rates and cost-of-living pressures dampened consumer spending.
While Spark has maintained strong cost discipline in an inflationary environment, the material deterioration in outlook for IT revenues, combined with subdued market conditions more broadly, has resulted in reduced FY24 EBITDAI outlook.
In line with these changes, Spark is accelerating its SPK-26 Operate Programme to bring efficiency benefits online faster.
Strong progress has been made on the Company’s operating model redesign, which is driving greater efficiency and rebalancing labour investment to changing growth profiles across the business.
This work will continue alongside broader efficiency initiatives to mitigate the impact of softer trading conditions.


i hold SPK