ABB -15.29%: a difficult start to the week for the telco which copped the double whammy of a weak market and soft outlook. FY22 was solid but well flagged though EBITDA of $39.4m was slightly ahead of guidance at $39m. The $9.6m contribution from the Over The Wire acquisition completed in the year was slightly below expectations, however, this was made up by 62% organic EBITDA growth in Business and +41% from residential. Guidance was where the company disappointed. Revenue is expected to be between $800-840m, in line with the market, but EBITDA margins were guided to 10-10.5%, reflecting a ~5% miss to consensus. There is potential for upside to the guidance if they can extract better than expected cost synergies from Over The Wire and upsell customers with additional solutions. The first 8 weeks of FY23 has seen 15k new connections, tracking nearly 20% below the 4th quarter run rate. Which was also disappointing.
MM is bullish ABB despite a weaker result
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