Blue chip or not?

Telstra has reported its results for the six months ended 31 December 2015.

Using a telescope rather than a microscope says this is no blue chip:

• Reported total income excluding financial income $14.2 billion
• Reported EBITDA $5.4 billion
• Net profit after tax $2.1 billion
• Earnings per share 17.2 cents
• Fully franked interim dividend of 15.5 cents
• Capital expenditure $2.1 billion

And here are the results for the same numbers for the same half, a decade ago.

Results for the six months to 31 December 2005

• Reported total income excluding financial income $11.6 billion
• Reported EBITDA $5.3 billion
• Net profit after tax $2.1 billion
• Earnings per share 17.3 cents
• Fully franked interim dividend of 20 cents
• Capital expenditure $1.81 billion

And here are the percentage changes for each item over the 10-year period. Note, these are total changes NOT per annum changes.

• Reported total income excluding financial income +22%
• Reported EBITDA +1.8%
• Net profit after tax –no change
• Earnings per share –(1/2%)
• Fully franked interim dividend of –(22.5%)
• Capital expenditure +16%

Enough said.

P.S. Does your fund manager own Telstra? Does your Individually Managed Account hold Telstra? No one has ever been sacked buying Telstra. Right? Maybe they should be.