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Speaker 1: Peter Lewis is going to talk through the EU slashing

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Speaker 1: those planned tariffs on Chinese evs. Gavin Gray is with

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Speaker 1: US out of the UK, and we will wrap the

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Speaker 1: political week that was with Barry sober as per usual,

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Speaker 1: seven past six. Now it is a tough result today

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Speaker 1: for Spark. They've reported a seventy two percent drop in

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Speaker 1: full year net profit, with revenue down fourteen percent. The

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Speaker 1: big drop comes after last year's results were boosted by

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Speaker 1: the sale of those cell towers, but the company has

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Speaker 1: acknowledged it's been a challenging year in tough economic conditions.

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Speaker 1: Jolie Hodson is Spark's chief executive. Hey, jolly hi head,

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Speaker 1: I right in thinking this looks worse than it actually

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Speaker 1: is because last year was boosted by the sales of

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Speaker 1: the towers.

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Speaker 2: Yeah, that's right.

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Speaker 3: The sale of the towers means that you have a

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Speaker 3: much higher prey or adjusted revenue on earnings. But really

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Speaker 3: we strip it out and look at like flight performance.

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Speaker 3: We did that in twenty three and we do that

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Speaker 3: here to look at how we've gone. But it has

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Speaker 3: been a tough year for Spark. Regardless, we did see

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Speaker 3: some growth in key markets like mobile, clouded data centers.

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Speaker 3: But equally we saw pressure and IT services as we

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Speaker 3: saw the impact of economic demand.

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Speaker 1: Yeah, what's going on here? Is it a cut back

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Speaker 1: in government spending or is it a cut back in

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Speaker 1: consumer spending?

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Speaker 3: So the IT services more around both public and private

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Speaker 3: sector spending, and you've obviously seen change going on in

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Speaker 3: those organizations as well, which is meant that some of

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Speaker 3: the projects and things are deferred. This is a combination

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Speaker 3: that's due to economy and then some of it's due

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Speaker 3: to the timing and when these things have been happening,

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Speaker 3: but nevertheless led to lower demand.

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Speaker 1: How much of a proportion of your business the affected

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Speaker 1: business is government spending.

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Speaker 3: We've got a significant part of our business enterprises government

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Speaker 3: spending within that because we offer ranger services right through

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Speaker 3: from mobile through to cloud DC. So we are affected

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Speaker 3: when you see changes, I guess in the market like this.

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Speaker 1: Yeah, so what do you do, Jolie. I mean, do

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Speaker 1: you guys accept this is the new normal under a

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Speaker 1: center right government or are you expecting it to pick

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Speaker 1: up again?

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Speaker 3: Look, I think, like all organizations, they're responding to changes

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Speaker 3: in the economy and what they need to do, and

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Speaker 3: I'd expect that we'd start to see potentially in the

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Speaker 3: second half of twenty five a per carp and demand

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Speaker 3: because I think the tools that help support and enable

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Speaker 3: productivity heads so technology are still going to.

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Speaker 2: Be important in the future. It's more about getting through

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Speaker 2: this change process.

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Speaker 1: So do you reckon we have to wait basically a

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Speaker 1: full year before we really start pumping again.

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Speaker 2: Look, I'm I'm experienced as anyone. I guess se what

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Speaker 2: the market might be.

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Speaker 3: But I think if we think about our first six

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Speaker 3: months of our financial year, which is really to Christmas,

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Speaker 3: I think it's still going to be a pretty challenging

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Speaker 3: environment and then after that we hope to see a

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Speaker 3: bit of improvement.

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Speaker 1: Then, so you're expecting actually some improvement after new year.

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Speaker 2: Yeah, look, that's what that's what we're looking for.

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Speaker 3: I guess we started to see some most of the

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Speaker 3: r cuts, and I think when you start see interest

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Speaker 3: rates falling in both the hands of consumers but also

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Speaker 3: in terms of businesses, it starts to make an impact.

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Speaker 1: Jolie, It's making me feel excited. The ocr cat's just

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Speaker 1: as a punter out there spending money on things like

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Speaker 1: a mortgage and whatever else. I feel like, are you

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Speaker 1: as a business leader feeling excited about it.

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Speaker 3: Look from my perspective, I think it's important that we

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Speaker 3: start to it's important that we see investment in New Zealand,

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Speaker 3: and so one of the things that we're really trying

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Speaker 3: to do is make sure that we're doing that. In

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Speaker 3: data sens is another growth opportunities and I think better

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Speaker 3: economic environment hopefully leads to seeing more of that investment there.

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Speaker 1: Yeah. Hey, so in the meantime, are you guys going

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Speaker 1: to have to cut down on your workforce?

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Speaker 3: Part of our changes is we looked at the shifts

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Speaker 3: we've seen in particular the enterprise and government aias meant

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Speaker 3: that we need to work out what's cyclical so affected

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Speaker 3: by the economy, and what actually structure needs to change.

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Speaker 3: So some of that is about getting a more sustainable

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Speaker 3: cost base for us. So it is making some changes

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Speaker 3: which we never take lightly for our people. It's not easy,

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Speaker 3: but we need to make sure that we can adjust

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Speaker 3: to both market demand and the things that customers are

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Speaker 3: looking for.

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Speaker 1: What numbers are you thinking?

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Speaker 3: Well, we included in our results release that there's about

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Speaker 3: a fifty million reduction in labor over the next twelve months,

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Speaker 3: but some of that change has already occurred in the

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Speaker 3: year that's been and so you see the flow through of.

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Speaker 2: That into if I twenty five. Yeah, and we have

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Speaker 2: some changes under at the moment.

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Speaker 1: So do you have any idea how many you still

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Speaker 1: have the cut how many people.

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Speaker 3: Look in terms of having translated that into heads. We've

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Speaker 3: had As I said, we've had some movements in twenty

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Speaker 3: four already, and there is work underway at the moment.

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Speaker 1: Did you see TV and Z is going into territory

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Speaker 1: that you've already trod, which is the old sports rights?

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Speaker 3: Yes, I think I did see something on that.

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Speaker 1: And what did you think, Jolie, did you think, mate,

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Speaker 1: don't do that?

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Speaker 3: I think they're in TV and entertainment and sports part

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Speaker 3: of that, and so if that works for them, that's great.

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Speaker 1: Do you think it's going to work better for them

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Speaker 1: than it does for you, because I mean, this is

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Speaker 1: not any disrespect to the way that you guys did it,

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Speaker 1: but they have a platform we're already using, whereas what

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Speaker 1: you required from us was to get this whole new platform.

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Speaker 1: I mean, does that make a difference.

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Speaker 3: Yeah, Like I think if you've got on a customer

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Speaker 3: base that's already using those platforms are used to seeing

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Speaker 3: different forms of both entertainment, and they already have sport

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Speaker 3: obviously some sport today, then that's going to be an.

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Speaker 2: Opportunity within it. But I'm in case they're going to

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Speaker 2: need to make those commercial decisions themselves about what that

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Speaker 2: looks like.

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Speaker 1: Heart Jolly listen, Thank you very much, appreciate it. Jolly Hodson,

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Speaker 1: chief executive of Spark. For more from Hither Duplessy Allen Drive,

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Speaker 1: listen live to news talks. It'd be from four pm weekdays,

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