Spark New Zealand’s FY26 results demonstrate that its SPK-30 strategy is delivering tangible operational progress, with mobile service revenue returning to growth for the first time. Mobile revenue expanded 4.4% in the year, while mobile service revenue specifically grew 1.1%, a meaningful reversal of prior weakness in that segment. The company also captured $40 million in productivity benefits during the first year of strategy execution, indicating that cost discipline is gaining traction across operations.
The financial performance came in line with guidance, though the reported figures require careful interpretation. Adjusted revenue remained flat at $3,700 million, while reported revenue reached $3,949 million, benefiting from accounting adjustments related to the completed data centre transaction. Adjusted EBITDAI declined 2.4% to $1,035 million, a modest contraction within the company’s guided range. Reported EBITDAI of $1,295 million and reported NPAT of $499 million reflect significant one-off benefits from the data centre sale, whereas adjusted NPAT declined 0.9% to $225 million, showing that the underlying business generates steady, if modest, earnings.
Free cash flow emerged as the clearest strength, increasing 18.5% to $308 million. This improvement reflects a combination of cost management and working capital efficiency, with business as usual capex holding flat at $401 million year-on-year. The company is achieving growth and efficiency gains without requiring material incremental investment. The completion of the data centre transaction has also restored the balance sheet to targeted leverage levels, providing financial flexibility for future shareholder distributions or strategic opportunities.
The board declared a final dividend of 8 cents per share, taking the full-year dividend to 16 cents per share and returning 100 percent of free cash flow to shareholders. This payout ratio signals confidence in the sustainability of cash generation and, combined with evidence of strategic progress, suggests the company is prepared to reward shareholders while building momentum behind the SPK-30 strategy.
For investors, the key focus now turns to the sustainability of mobile revenue momentum in a maturing telecom market. Whether Spark can defend market share and continue customer acquisition at current rates will determine whether the SPK-30 strategy can drive higher earnings growth beyond the current flat trajectory. The $40 million productivity target should be monitored for subsequent years to confirm cost discipline is structural rather than a one-time achievement. Execution risks remain around the full strategy rollout, particularly if regulatory or competitive pressures compress margins. This announcement is price sensitive and has been flagged as material by the ASX.
View the full ASX announcement (PDF)
About Spark New Zealand Limited (ASX: SPK)
Spark New Zealand Limited is the largest telecommunications company in New Zealand, providing a comprehensive range of telecommunications, information technology, media and digital products and services to individuals, households, small businesses, and enterprises. The company’s offerings include mobile services, broadband, IT products and services, voice services, and data center solutions. Spark operates throughout New Zealand serving both consumer and business segments.
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