Telstra tops half-year results with Trujillo's departure

Telstra Chairman Donald McGauchie today announced that the company’s Chief Executive Officer, Sol Trujillo, will leave the company on 30 June 2009 to return home to the United States. The announcement comes in parallel with the release of the first financial half results, which saw free cash flow grow by 44% to $1.9 billion.

Telstra shareholders will be happy with the dividend being maintained at 14 cents fully franked. Trujillo said, "Our strong balance sheet enables Telstra to invest in the future with our five-year transformation on track."

Sales revenue grew 3.2% to $12,644 million — an increase from the 3% growth in the previous half year. Total revenue grew 2.7% to $12,710 million. A standout in operational highlights was retail broadband revenue grew 31.3%, with fixed broadband services In operation (SIO) growth three times the nearest competitor.

Trujillo discussed his intentions with the Board yesterday.  McGauchie said  Trujillo and the Board agreed that now was a suitable time for a transition to a new CEO given Telstra’s transformation is well advanced and on track.

The Board, through its Nomination Committee, is well prepared with succession planning and will now formally commence a wide-ranging search for a suitable successor. The Board expects to make an appointment by 30 June 2009.

“On behalf of the Telstra Board, I would like to congratulate Sol on his outstanding leadership and extraordinary achievements,”  McGauchie said.

“His vision, strategic direction and commitment to execution have positioned Telstra as a media communications company with a wide range of options for ongoing growth.

“Under Sol’s leadership, Telstra has significantly outperformed the market and its global peers, producing world-leading results within the telecommunications sector.

“The Next G network is undeniably the world’s best national mobile broadband network and stands as Sol’s crowning achievement.”

Trujillo said he would continue to drive the business until his departure at the end of June and work with the Board and senior management to ensure a smooth transition.

“Telstra is outperforming domestic and global peers in virtually every category. We are well positioned to hit the key transformation targets we set in November 2005 and I have every confidence that Telstra will continue to deliver world-leading results for shareholders.”

McGauchie said that Sol’s many achievements include:

• the integrated Next G and Next IP networks
• a critical role in the successful completion of Telstra’s privatisation
• driving innovation across the company
• the migration of seven million customers to Telstra’s new IT platforms
• the rollout of ADSL2+ to exchanges covering 82% of the population
• market-based management and customer segmentation
• the launch and rollout of the T[life] stores
• expansion into mainland China with successful new acquisition.