Spark New Zealand Limited H1 FY21 Results

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand


MARKET RELEASE
24 February 2021

Spark New Zealand delivers steady performance amid COVID-19
challenges and updates dividend guidance on improved outlook

Spark New Zealand (Spark) today announced its financial results for the six months to 31
December 2020.

Revenue
1
decreased 1.5% to $1,796 million due to the loss of higher-margin mobile roaming
revenue from sustained COVID-19 border closures and higher voice revenue declines due to a
non-recurring provision to refund historical wire maintenance charges.

While mobile service revenue declined $5 million, or 1.2%, Spark’s underlying performance
remains strong. When stripping out the impact of the loss of roaming, mobile service revenue
increased 3.8% from H1 FY20.

Spark continued to experience growth in cloud, security and service management revenue,
which increased 4.6% to $229 million.

The broadband and prepaid markets were impacted as border closures resulted in
approximately 44,000 fewer people migrating to New Zealand in H1 FY21 vs. H1 FY20
2
.

Disciplined cost management saw operating expenses decrease $30 million, or 2.3%, offsetting
revenue declines. As a result, EBITDAI
3
grew 0.4% to $502 million.

Net profit after tax reduced 11.4% to $148 million, driven by a $29 million increase in
depreciation and amortisation charges resulting from the shorter asset lives of new digital
technologies, and an increase in depreciation related to customer and property leases.

Spark announced an interim dividend per share of 12.5 cents, 100% imputed, and will also
continue to operate the Dividend Re-investment Plan with a 2% discount.

Spark Chair Justine Smyth said: “COVID-19 has continued to challenge us as a nation, but it is
encouraging to see New Zealand’s economy bouncing back more quickly than expected.

“With borders closed for the foreseeable future we have had to adapt at pace to the ongoing
loss of mobile roaming revenues and lower growth broadband and prepaid markets.

“The implications of COVID-19 for Spark have be come clearer during the first half, with the
overall FY21 EBITDAI impact now expected to be $50 million, versus the original estimate of
$75 million.

“As a result, we have narrowed our FY21 EBITDAI guidance range to $1,100 million to $1,130
million
4
, and the Board and I are pleased to revise full year dividend guidance to the top end of
the range at 25 cents per share.”


1
Operating revenue and other gains.
2
Source: Statistics NZ net migration.
3
Earnings before finance income and expense, income tax, depreciation, amortisation and net investment income. This
is a non-GAAP financial measure.

4
Previously $1,090 million to $1,130 million. Subject to no adverse change in operating outlook.

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand


The Company is now six months into its new three-year strategy and making solid progress
growing its competitive advantage across core established markets and future growth markets.

Spark CEO Jolie Hodson said: “Our focus on delivering simpler, more intuitive customer
experiences is progressing well, with the launch of our new Spark App, a further 18 % of
customer care interactions now being self-solved digitally, and more than 100 legacy plans
already retired – with customers shifted to products that best suit their needs.

“We are also introducing a new frontline operating model where we are cross-skilling our
customer care team members to improve first contact resolution, which is an important driver
of customer satisfaction, and productivity.


“Demand for business transformation and digitisation continues to grow, spurred on by the
rapid adoption of new ways of working established during COVID-19 lockdowns. We are
investing behind digital skills programs for our small business customers, to support their
adaptation to an increasingly digital marketplace.

“The broadband market was impacted during the half as COVID-19 border closures reduced the
number of people moving to New Zealand and needing a connection. While this has impacted
our growth aspirations in the short term, our longer-term wireless ambitions have not changed.
There remains a significant addressable market, which continues to grow as we roll out 5G, and
precision marketing is helping us to identify customers who are best suited to wireless
broadband and provide them compelling, tailored offers.

“We have 5G available in five locations across New Zealand
5
, and we are now live testing in
Christchurch, with mobile and wireless broadband offers launching to customers next month.

“We are making steady progress in our future markets, with Internet of Things (IoT)
connections growing 65% during the half, our Digital Health Platform in development, and New
Zealand’s summer of cricket being successfully delivered and well received by Spark Sport
customers.

“Cost management will remain a focus in the second half, to ensure we have the ability to
respond to changing conditions if we need to.”

Spark will hold an Investor Briefing on Wednesday 24 March to provide further insight into the
IT and Managed Services side of its business.

Authorised by:
Alastair White
GM Capital Markets
- ENDS –

Media queries: Investor queries:
Leela Gantman Alastair White
Corporate Relations Director GM Capital Markets
+64 (0) 27 541 6338 +64 (0) 21 228 3855

5
Auckland, Dunedin, Palmerston North, Te Awamutu and New Plymouth

---

FY2021
INTERIM
FINANCIAL
STATEMENTS

INTERIM
FINANCIAL
STATEMENTS
For the six months ended 31 December 2020
Interim financial statements03
Notes to the interim financial statements07
Independent auditor’s review report17
These interim financial statements do not
include all the notes and information normally
included in the annual financial statements.
Accordingly, they should be read in conjunction
with the annual financial statements for the year
ended 30 June 2020.
Page 02
Spark New ZealandInterim financial statements

Statement of profit or loss and other comprehensive income
FOR THE SIX MONTHS ENDED 31 DECEMBER
20202019
UNAUDITEDUNAUDITED
NOTE$M$M
Operating revenues and other gains 1,796 1,824
Operating expenses (1,294) (1,324)
Earnings before finance income and expense, income tax,
depreciation, amortisation and net investment income (EBITDAI) 502 500
Finance income 17 18
Finance expense (43) (46)
Depreciation and amortisation (263) (234)
Net investment income – (1)
Net earnings before income tax3 213 237
Income tax expense (65) (70)
Net earnings for the period 148 167
Other comprehensive income
Items that will not be reclassified to profit or loss:
Revaluation of long-term investments designated at fair value
through other comprehensive income (51) 13
Items that may be reclassified to profit or loss:
Cash flow hedges net of tax 10 1
Other comprehensive income for the period (41) 14
Total comprehensive income for the period 107 181
Earnings per share
Basic and diluted earnings per share (cents) 8.0 9.1
Weighted average ordinary shares (millions) 1,844 1,837
Weighted average ordinary shares and options (millions) 1,846 1,838
See accompanying notes to the interim financial statements.
Page 03
Spark New ZealandInterim financial statements

Statement of financial position
AS AT
31 DECEMBER
AS AT
30 JUNE
20202020
UNAUDITEDAUDITED
NOTES$M$M
Current assets
Cash 103 53
Short-term receivables and prepayments 746 777
Short-term derivative assets– 1
Inventories 84 96
Taxation recoverable 1 1
Total current assets 934 928
Non-current assets
Long-term receivables and prepayments 292 284
Long-term derivative assets 48 60
Long-term investments5 261 308
Right-of-use assets 617 698
Leased customer equipment assets 79 86
Property, plant and equipment 948 1,015
Intangible assets 1,016 968
Total non-current assets 3,261 3,419
Total assets 4,195 4,347
Current liabilities
Short-term payables, accruals and provisions 431 463
Taxation payable 3 44
Short-term derivative liabilities 14 5
Short-term lease liabilities 55 41
Debt due within one year6 297 228
Total current liabilities 800 781
Non-current liabilities
Long-term payables, accruals and provisions 62 81
Long-term derivative liabilities 133 156
Long-term lease liabilities 445 531
Long-term debt6 1,264 1,244
Deferred tax liabilities 54 61
Total non-current liabilities 1,958 2,073
Total liabilities 2,758 2,854
Equity
Share capital 1,016 949
Reserves (394) (353)
Retained earnings 815 897
Total equity 1,437 1,493
Total liabilities and equity 4,195 4,347
See accompanying notes to the interim financial statements.
On behalf of the Board
Justine Smyth, Chair Jolie Hodson, Chief Executive
Authorised for issue on 24 February 2021
Page 04
Spark New ZealandInterim financial statements

Statement of changes in equity
SIX MONTHS ENDED
31 DECEMBER 2020
SHARE
CAPITAL
RETAINED
EARNINGS
HEDGE
RESERVE
SHARE-
BASED
COMPEN-
SATION
RESERVE
RE-
VALUATION
RESERVE
FOREIGN
CURRENCY
TRANS-
LATION
RESERVETOTAL
UNAUDITED$M$M$M$M$M$M$M
Balance at 1 July 2020 949 897 (120) 2 (212) (23) 1,493
Net earnings for the period – 148 – – – – 148
Other comprehensive income/(loss) – – 10 – (51) – (41)
Total comprehensive income/(loss)
for the period – 148 10 – (51) – 107
Contributions by, and distributions
to, owners:
Dividends – (230) – – – – (230)
Supplementary dividends – (24) – – – – (24)
Tax credit on
supplementary dividends – 24 – – – – 24
Dividend reinvestment plan 63 – – – – – 63
Issuance of shares under
share schemes 4 – – – – – 4
Total transactions with owners 67 (230) – – – – (163)
Balance at 31 December 2020 1,016 815 (110) 2 (263) (23) 1,437
SIX MONTHS ENDED
31 DECEMBER 2019
SHARE
CAPITAL
RETAINED
EARNINGS
HEDGE
RESERVE
SHARE-
BASED
COMPEN-
SATION
RESERVE
RE-
VALUATION
RESERVE
FOREIGN
CURRENCY
TRANS-
LATION
RESERVETOTAL
UNAUDITED$M$M$M$M$M$M$M
Balance at 1 July 2019 945 929 (85) 2 (303) (23) 1,465
Net earnings for the period – 167 – – – – 167
Other comprehensive income/(loss) – – 1 – 13 – 14
Total comprehensive income/(loss)
for the period – 167 1 – 13 – 181
Contributions by, and distributions
to, owners:
Dividends – (229) – – – – (229)
Supplementary dividends – (19) – – – – (19)
Tax credit on
supplementary dividends – 19 – – – – 19
Issuance of shares under
share schemes 4 – – (1) – – 3
Total transactions with owners 4 (229) – (1) – – (226)
Balance at 31 December 2019 949 867 (84) 1 (290) (23) 1,420
Page 05
Spark New ZealandInterim financial statements

Statement of cash flows
FOR THE SIX MONTHS ENDED 31 DECEMBER
20202019
UNAUDITEDUNAUDITED
NOTE$M$M
Cash flows from operating activities
Receipts from customers 1,828 1,861
Receipts from interest 16 17
Payments to suppliers and employees (1,319) (1,396)
Payments for income tax (118) (82)
Payments for interest on debt (23) (26)
Payments for interest on leases (16) (14)
Payments for interest on leased customer equipment assets (4) (3)
Net cash flows from operating activities7 364 357
Cash flows from investing activities
Proceeds from sale of property, plant and equipment– 13
Proceeds from sale of business 8 –
Payments for purchase of business– (11)
Payments for, and advances to, long-term investments (4) (30)
Payments for purchase of property, plant and equipment,
intangibles and capacity (214) (273)
Payments for capitalised interest (3) (4)
Net cash flows from investing activities (213) (305)
Cash flows from financing activities
Net proceeds from debt 100 207
Receipts from finance leases 2 2
Payments for dividends (167) (229)
Payments for leases (20) (19)
Payments for leased customer equipment assets (16) (13)
Net cash flows from financing activities (101) (52)
Net cash flow 50 –
Opening cash position 53 54
Closing cash position 103 54
See accompanying notes to the interim financial statements.
Page 06
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 1 About this report
Reporting entity
These unaudited interim financial statements
are for Spark New Zealand Limited (the
‘Company’) and its subsidiaries (together
‘Spark’ or ‘the Group’) for the six months
ended 31 December 2020.
The Company is incorporated and domiciled in
New Zealand, registered under the Companies
Act 1993 and is an FMC reporting entity under
the Financial Markets Conduct Act 2013. The
Company is listed on the New Zealand Main
Board equity security market and the Australian
Securities Exchange.
Basis of preparation
The interim financial statements have
been prepared in accordance with Generally
Accepted Accounting Practice in New Zealand
(‘NZ GAAP’) and comply with the New Zealand
equivalent to International Accounting
Standard 34: Interim Financial Reporting
and International Accounting Standard 34:
Interim Financial Reporting.
The accounting policies adopted are consistent
with those followed in the preparation of Spark’s
annual financial statements for the year ended
30 June 2020. The preparation of the interim
financial statements requires management to
make estimates and assumptions. Spark has
been consistent in applying the estimates and
assumptions adopted in the annual financial
statements for the year ended 30 June 2020
and critical accounting policies are the same as
those set out in the annual financial statements
for the year ended 30 June 2020. Certain
comparative information has been updated to
conform with the current year’s presentation.
Financial instruments are either carried at
amortised cost, less any provision for
impairment, or fair value. The only significant
variances between instruments held at
amortised cost and their fair value relate to
long-term debt. There were no changes in
valuation techniques during the period. Spark’s
derivatives are held at fair value, calculated
using discounted cash flow models and
observable market rates of interest and foreign
exchange and electricity prices. This represents
a level two measurement under the fair value
measurement hierarchy, being inputs other
than quoted prices included within level one
that are observable for the asset or liability.
At 31 December 2020, capital expenditure
amounting to $223 million (31 December 2019:
$249 million) had been committed under
contractual arrangements. Included within this
commitment is $50 million, for the renewal of
Spark’s 1800MHz and 2100MHz spectrum rights,
which was paid in January 2021.
Page 07
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 2 Significant transactions and events for the current period
The following significant transactions and events
affected the financial performance and financial
position of Spark for the six month period to
31 December 2020:
Debt programme (see note 6)
• On 30 November 2020 Spark renewed its
$200 million committed revolving facility
with Westpac New Zealand, to mature on
30 November 2023.
Capital expenditure
• Spark’s additions to property, plant and
equipment and intangible assets were
$192 million, details of which are available
in a separate detailed financials file on the
investor section of our website at: investors.
sparknz.co.nz/investor-centre.
Dividends
• Dividends paid during the six month period
ended 31 December 2020 in relation to the
H2 FY20 second-half dividend (ordinary
dividend of 12.5 cents per share) totalled
$230 million or 12.5 cents per share.
Wire maintenance customer refunds
• Wire maintenance is a Spark service designed
to cover the cost of repairing certain faults
with a customer’s internal wiring. Spark
has now withdrawn this product for fibre
customers and has made a provision,
for credits to customers who purchased
this product while on a fibre connection,
in the current period of approximately
$17 million. This is included within voice
revenues (see note 3).
COVID-19
• The effects of COVID-19 continue to have a
negative impact on the financial performance
of Spark’s business, predominantly due to lost
roaming revenues partially offset by lower
than anticipated bad debt costs.
Page 08
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 3 Segment information
FOR THE SIX MONTHS ENDED
31 DECEMBER
20202019
OPERATING
REVENUES
PRODUCT
COSTS
PRODUCT
MARGIN
OPERATING
REVENUES
PRODUCT
COSTS
PRODUCT
MARGIN
UNAUDITED$M$M$M$M$M$M
Mobile 651 (244) 407 653 (248) 405
Voice
1
158 (68) 90 199 (75) 124
Broadband 337 (171) 166 345 (170) 175
Cloud, security and service
management 229 (50) 179 219 (43) 176
Procurement and partners 237 (216) 21 208 (187) 21
Managed data, networks
and services 123 (55) 68 121 (56) 65
Other operating revenues 57 (29) 28 75 (60) 15
Segment result 1,792 (833) 959 1,820 (839) 981
1 Refer to note 2 for the impact of wire maintenance customer refunds on voice revenues.
The segment results disclosed are based on
those reported to the Chief Executive and are
how Spark reviews its performance. Spark’s
segment results are measured based on
product margin which includes product
operating revenues and direct product costs.
The segment result excludes labour, operating
expenses, depreciation and amortisation,
net investment income, finance income and
expense and income tax expense as these
are assessed at an overall Spark Group level
by the Chief Executive.
Page 09
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 3 Segment information (continued)
Reconciliation from segment result to consolidated net earnings before income tax
SIX MONTHS ENDED 31 DECEMBER20202019
UNAUDITED$M$M
Segment product margin 959 981
Other gains 4 4
Labour (255) (267)
Other operating expenses
Network support costs (43) (35)
Computer costs (51) (49)
Accommodation costs (32) (33)
Advertising, promotions and communication (44) (47)
Bad debts 1 (7)
Other (37) (47)
Earnings before finance income and expense, income tax, depreciation,
amortisation and net investment income (EBITDAI) 502 500
Finance income
Finance lease interest income 6 7
Other interest income 11 11
Finance expense
Finance expense on long-term debt (21) (25)
Capitalised interest 3 4
Other interest and finance expenses (6) (7)
Lease interest expense (15) (15)
Leased customer equipment interest expense (4) (3)
Depreciation and amortisation expense
Depreciation - property, plant and equipment (124) (119)
Depreciation - right-of-use assets (35) (28)
Depreciation - leased customer equipment assets (19) (15)
Amortisation of intangibles (85) (72)
Net investment income
Share of associates' and joint ventures' net losses – (1)
Net earnings before income tax 213 237
Page 10
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 4 Non-GAAP measures
In addition to New Zealand Equivalents to
International Financial Reporting Standards
(‘NZ IFRS’) Spark uses non-GAAP financial
measures. Spark believes that these non-GAAP
financial measures provide useful information
to readers to assist in the understanding of
the financial performance, financial position
or returns of Spark. These measures are also
used internally to evaluate performance of
products, to analyse trends in cash-based
expenses, to establish operational goals and
allocate resources. However, they should not
be viewed in isolation, nor considered as a
substitute for measures reported in accordance
with NZ IFRS, as they are not uniformly defined
or utilised by all companies in New Zealand or
the telecommunications industry.
Spark’s policy is to present ‘adjusted EBITDAI’
and ‘adjusted net earnings’ when a financial year
includes significant items (such as one-off gains,
expenses and impairments) greater than
$25 million. There are no adjusting items
for the six months ended 31 December 2020
or 31 December 2019.
Earnings before finance expense and
income, net investment income, income tax,
depreciation and amortisation (EBITDAI)
Spark calculates EBITDAI by adding back
depreciation and amortisation, finance
expense and income tax expense and
subtracting finance income and net investment
income (which includes dividend income
and Spark’s share of net profits or losses from
associates and joint ventures) to net earnings.
A reconciliation of Spark’s EBITDAI is provided
below and based on amounts taken from, and
consistent with, those presented in these interim
financial statements.
SIX MONTHS ENDED 31 DECEMBER20202019
UNAUDITED$M$M
Net earnings for the period reported under NZ IFRS 148 167
Less: finance income (17) (18)
Add back: finance expense 43 46
Add back: depreciation and amortisation 263 234
Add back: net investment income– 1
Add back: income tax expense 65 70
EBITDAI 502 500
Page 11
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 5 Long-term investments
AS AT
31 DECEMBER
AS AT
30 JUNE
20202020
UNAUDITEDAUDITED
$M$M
Shares in Hutchison 196 247
Investment in associates and joint ventures 58 54
Other long-term investments 7 7
261 308
Spark holds a 10% interest in Hutchison Telecommunications Australia Limited (Hutchison)
which is quoted on the Australian Securities Exchange (ASX) and measures its fair value using
its observable market bid share price as quoted on the ASX, classified as being within level 1
of the fair value hierarchy. As at 31 December 2020 the quoted price of Hutchison’s shares on
the ASX was A$0.135 (30 June 2020: A$0.170). The change in fair value is recognised in other
comprehensive income.
Investment in associates and joint ventures
Spark’s investment in associates and joint ventures at 31 December 2020 consists of the following:
NAMETYPECOUNTRYOWNERSHIPPRINCIPAL ACTIVITY
Connect 8 LimitedJoint VentureNew Zealand50%Fibre network
construction
Flok LimitedAssociateNew Zealand38%Hardware and software
development
NOW New Zealand LimitedAssociateNew Zealand32%Internet service
provider
Pacific Carriage Holdings LimitedAssociateBermuda38%A holding company
Pacific Carriage Holdings
Limited Inc
AssociateUnited States35%A holding company
PropertyNZ Limited
(homes.co.nz)
AssociateNew Zealand22%Property data website
Rural Connectivity Group LimitedJoint VentureNew Zealand33%Rural broadband
Southern Cross Cables
Holdings Limited
AssociateBermuda35%A holding company
TNAS LimitedJoint VentureNew Zealand50%Telecommunications
development
Page 12
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 6 Debt
AS AT
31 DECEMBER
AS AT
30 JUNE
20202020
COUPON
RATE
UNAUDITEDAUDITED
FACE VALUEFACILITYMATURITY$M$M
Short-term debt
Short-term borrowingsVariable< 1 month 41 –
Commercial paperVariable< 3 months 256 228
297 228
Bank funding
The Hongkong and Shanghai
Banking Corporation Limited100 million NZDVariable30/11/2021 – 50
MUFG Bank, Ltd125 million NZDVariable30/11/2022 125 100
Westpac New Zealand Limited200 million NZDVariable30/11/2023 57 –
182 150
Domestic notes
100 million NZD4.50%25/03/2022 102 103
100 million NZD4.51%10/03/2023 107 108
125 million NZD3.37%07/03/2024 133 135
125 million NZD3.94%07/09/2026 137 140
479 486
Foreign currency Medium Term Notes
Australian Medium Term Notes – 100 million AUD1.90%05/06/2026 108 107
Australian Medium Term Notes – 150 million AUD4.00%20/10/2027 184 185
Australian Medium Term Notes – 125 million AUD2.60%18/03/2030 138 139
Norwegian Medium Term Notes – 1 billion NOK
1
3.07%19/03/2029 173 177
603 608
1,561 1,472
Debt due within one year 297 228
Long-term debt 1,264 1,244
1 Norwegian krone
There have been no changes in Spark’s short-term financing programmes or stand-by facilities since
30 June 2020. Changes in long-term financing are disclosed in note 2 page 8 of these interim
financial statements.
Page 13
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 6 Debt (continued)
Net debt
Net debt at hedged rates, the primary net debt measure Spark monitors, includes long-term debt
at the value of hedged cash flows due to arise on maturity, plus short-term debt, less any cash.
Net debt at carrying value includes the non-cash impact of fair value hedge adjustments and
any unamortised discount.
Net debt at hedged rates is a non-GAAP measure and is not defined in accordance with NZ IFRS
but is a measure used by management. A reconciliation of net debt at hedged rates and net debt
at carrying value is provided below:
AS AT
31 DECEMBER
AS AT
30 JUNE
20202020
UNAUDITEDAUDITED
$M$M
Cash (103) (53)
Short-term debt at face value 297 228
Long-term debt at face value 1,195 1,162
Net debt at face value 1,389 1,337
To retranslate debt balances at swap rates where hedged by currency swaps 11 12
Net debt at hedged rates
1
1,400 1,349
Non-cash adjustments
Impact of fair value hedge adjustments
2
1413
Unamortised discount – –
Net debt at carrying value 1,4141,362
1 Net debt at the value of hedged cash flows due to arise on maturity and includes adjustment to state principal of foreign
currency medium term notes at the hedged currency rate.
2 Fair value hedge adjustments arise on domestic notes and foreign currency medium term notes in hedging relationships.
These have no impact on the cash flows to arise on maturity.


Page 14
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 7 Reconciliation of net earnings to net cash flows from operating activities
SIX MONTHS ENDED 31 DECEMBER20202019
UNAUDITED$M$M
Net earnings for the period 148 167
Adjustments to reconcile net earnings to net cash flows from
operating activities
Depreciation and amortisation 263 234
Bad and doubtful accounts 1 9
Deferred income tax (11) (3)
Share of associates' and joint ventures' net losses– 1
Impairments– –
Other gains (4) (4)
Other 1 5
Changes in assets and liabilities net of effects of non-cash and
investing and financing activities
Movement in receivables and related items 24 19
Movement in inventories 12 (41)
Movement in current taxation (41) (9)
Movement in payables and related items (29) (21)
Net cash flows from operating activities 364 357
Page 15
Spark New ZealandInterim financial statements

Notes to the interim financial statements
NOTE 8 Dividends
On 24 February 2021, the Board approved the payment of a first half ordinary dividend of 12.5 cents
per share or approximately $231 million. The dividend will be 100% imputed in line with the
corporate income tax rate. In addition, supplementary dividends totalling approximately $24 million
will be payable to shareholders who are not resident in New Zealand. In accordance with the Income
Tax Act 2007, Spark will receive a tax credit from Inland Revenue equivalent to the amount of
supplementary dividends paid.
H1 FY21
ORDINARY DIVIDENDS
Dividends declared
Ordinary shares12.5 cents
American Depositary Shares
1
45.66 US cents
Imputation
Percentage imputed100%
Imputation credits per share4.8611 cents
Supplementary dividend per share
2
2.2059 cents
‘Ex’ dividend dates
New Zealand Stock Exchange18/03/21
Australian Securities Exchange18/03/21
American Depositary Shares 18/03/21
Record dates
New Zealand Stock Exchange19/03/21
Australian Securities Exchange19/03/21
American Depositary Shares 19/03/21
Payment dates
New Zealand and Australia 9/04/21
American Depositary Shares 19/04/21
1 For H1 FY21, these are based on the exchange rate at 19 February 2021 of NZ$1 to US$0.7306 and a ratio of five ordinary
shares per one American Depositary Share. The actual exchange rate used for conversion is determined in the week prior
to payment when the Bank of New York performs the physical currency conversion.
2 Supplementary dividends are paid to non-resident shareholders.
Dividend Reinvestment Plan
The dividend reinvestment plan has been retained for the H1FY21 dividend. Shares issued under
the dividend reinvestment plan will be issued at a 2% discount to the prevailing market price as
determined around the time of issue.  The last date for shareholders to elect to participate in the
dividend reinvestment plan for the H1 FY21 dividend is 22 March 2021.
Spark’s Dividend Reinvestment Plan Offer Document and Participation Notice can be found on
Spark’s Investor Centre Website: investors.sparknz.co.nz
Page 16
Spark New ZealandInterim financial statements

Independent Auditor’s Review Report
To the Shareholders of Spark New Zealand Limited
Conclusion
We have reviewed the condensed consolidated interim financial statements (‘interim financial
statements’) of Spark New Zealand Limited (‘the Company’) and its subsidiaries (‘the Group’), which
comprise the statement of financial position as at 31 December 2020, and, the statement of profit or
loss and other comprehensive income, statement of changes in equity and statement of cash flows
for the six months ended on that date, and a summary of significant accounting policies and other
explanatory information on pages 3 to 16.
Based on our review, nothing has come to our attention that causes us to believe that the interim
financial statements of the Group do not present fairly, in all material respects, the financial position
of the Group as at 31 December 2020 and its financial performance and cash flows for the six
months ended on that date in accordance with NZ IAS 34 Interim Financial Reporting and IAS 34
Interim Financial Reporting.
Basis for Conclusion
We conducted our review in accordance with NZ SRE 2410 (Revised) Review of Financial Statements
Performed by the Independent Auditor of the Entity (‘NZ SRE 2410 (Revised)’). Our responsibilities
are further described in the Auditor’s Responsibilities for the Review of the Interim Financial
Statements section of our report.
We are independent of the Group in accordance with the relevant ethical requirements in
New Zealand relating to the audit of the annual financial statements, and we have fulfilled our
other ethical responsibilities in accordance with these requirements.
Our firm carries out other assignments for Spark New Zealand Limited in the area of taxation
advisory and compliance services and holiday pay compliance work. These services have not
impaired our independence as auditor of the Group. In addition to this, the Chief Executive
has both a sister and brother-in-law that are partners at Deloitte. These Deloitte partners are not
involved in the provision of any services to the Group and its subsidiaries and this matter has not
impacted our independence. Also, partners and employees of our firm deal with Group on normal
terms within the ordinary course of trading activities of the business of the Group. The firm has no
other relationship with, or interest in the Group.
Directors’ responsibilities for the interim financial statements
The directors are responsible on behalf of the Company for the preparation and fair presentation
of the interim financial statements in accordance with NZ IAS 34 Interim Financial Reporting and
IAS 34 Interim Financial Reporting and for such internal control as the directors determine is
necessary to enable the preparation and fair presentation of the interim financial statements
that are free from material misstatement, whether due to fraud or error.
Auditor’s responsibilities for the review of the interim financial statements
Our responsibility is to express a conclusion on the interim financial statements based on our review.
NZ SRE 2410 (Revised) requires us to conclude whether anything has come to our attention that
causes us to believe that the interim financial statements, taken as a whole, are not prepared, in all
material respects, in accordance with NZ IAS 34 Interim Financial Reporting and IAS 34 Interim
Financial Reporting.
Page 17
Spark New ZealandIndependent auditor’s review report

A review of the interim financial statements in accordance with NZ SRE 2410 (Revised) is a limited
assurance engagement. We perform procedures, primarily consisting of making enquiries, primarily
of persons responsible for financial and accounting matters, and applying analytical and other
review procedures. The procedures performed in a review are substantially less than those
performed in an audit conducted in accordance with International Standards on Auditing
(New Zealand) and consequently do not enable us to obtain assurance that we might identify
in an audit. Accordingly we do not express an audit opinion on the interim financial statements.
Restriction on use
This report is made solely to the Company’s shareholders, as a body. Our review has been
undertaken so that we might state to the Company’s shareholders those matters we are required to
state to them in a review report and for no other purpose. To the fullest extent permitted by law, we
do not accept or assume responsibility to anyone other than the Company’s shareholders as a body,
for our engagement, for this report, or for the conclusions we have formed.
Jason Stachurski, Partner
for Deloitte Limited
Auckland, New Zealand
24 February 2021
Page 18
Spark New ZealandInterim financial statements

Contact details
Registered office
Level 2
Spark City
167 Victoria Street West
Auckland 1010
New Zealand
Ph +64 4 471 1638 or 0800 108 010
Company secretary
Silvana Roest
New Zealand registry
Link Market Services Limited
Level 11 Deloitte Centre
PO Box 91976
80 Queen Street
Auckland 1142
Ph +64 9 375 5998 (investor enquiries)
Fax +64 9 375 5990
enquiries@linkmarketservices.com
www.linkmarketservices.co.nz
Australian registry
Link Market Services Limited
Level 12
680 George Street
Sydney NSW 2000
Australia
Locked Bag A14
Sydney South NSW 1235
Australia
Ph +61 1300 554 484 (investor enquiries)
Fax +61 2 9287 0303
registrars@linkmarketservices.com.au
www.linkmarketservices.com.au
Spark New Zealand Limited
ARBN 050 611 277
United States registry
Computershare Investor Services
P.O. Box 505000
Louisville, KY 40233-5000
United States of America
Ph +1 888 BNY ADRS (+1 888 269 2377)
or +1 201 680 6825 (from outside the
United States)
shrrelations@cpushareownerservices.com
www-us.computershare.com/investor
For more information
For inquiries about Spark’s operating and
financial performance contact:
investor-info@spark.co.nz
Investor Relations
Spark New Zealand Limited
Private Bag 92028
Auckland 1142
New Zealand
investors.sparknz.co.nz
insight
creative.co.nz
SPARK051 02/21
Page 19
Spark New ZealandInterim financial statements

investors.sparknz.co.nz
ARBN 050 611 277

---

Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)





Results for announcement to the market
Name of issuer Spark New Zealand Limited
Reporting Period 6 months to 31 December 2020
Previous Reporting Period 6 months to 31 December 2019
Currency NZD - New Zealand Dollar
Amount (000s) Percentage change
Revenue from continuing
operations
NZD$1,796,000 -1.5%
Total Revenue NZD$1,796,000 -1.5%
Net profit/(loss) from
continuing operations
NZD$148,000 -11.4%
Total net profit/(loss) NZD$148,000 -11.4%
Interim/Final Dividend
Amount per Quoted Equity
Security
NZD$0.12500000 (comprised only of an ordinary dividend)
Imputed amount per Quoted
Equity Security
NZD$0.04861111
Record Date 19 March 2021
Dividend Payment Date 9 April 2021
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
As at 31 December 2020:
NZD$0.23
As at 31 December 2019:
NZD$0.22
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
Changes in Spark’s earnings before finance income and
expense, income tax, depreciation, amortisation and net
investment income (EBITDAI) are provided in the addendum.
Authority for this announcement
Name of person

authorised
to make this announcement
Stefan Knight, Finance Director (CFO)
Contact person for this
announcement
Alastair White, GM Capital Markets
Contact phone number +64 (0) 21 228 3855
Contact email address investor-info@spark.co.nz
Date of release through MAP

24 February 2021

Unaudited financial statements accompany this announcement.

Addendum:

Amount (000s) Percentage
change
Reported earnings before finance income and expense,
income tax, depreciation, amortisation and net investment
income (Reported EBITDAI)
NZD$502,000 0.4%

---

Distribution Notice







Section 1: Issuer information
Name of issuer Spark New Zealand Limited
Financial product name/description Ordinary shares
NZX ticker code SPK
ISIN (If unknown, check on NZX
website)
NZ TELE0001S4
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year Quarterly
Half Year X Special
DRP applies Yes
Record date 19 March 2021
Ex-Date (one business day before the
Record Date)
18 March 2021
Payment date (and allotment date for
DRP)
9 April 2021 AUST & NZ;
19 April 2021 USA
Total monies associated with the
distribution
NZD$231,483,928
(1,851,871,427 shares @ $0.125 per share)
Source of distribution (for example,
retained earnings)
Retained earnings
Currency NZD - New Zealand Dollar
Section 2: Distribution amounts per financial product
Gross distribution NZD$0.17361111
Gross taxable amount NZD$0.17361111
Total cash distribution NZD$0.12500000
Excluded amount (applicable to listed
PIEs)
N/A
Supplementary distribution amount NZD$0.02205882
Section 3: Imputation credits and Resident Withholding Tax
Is the distribution imputed Fully imputed
Partial imputation
No imputation
If fully or partially imputed, please
state imputation rate as % applied
28%
Imputation tax credits per financial
product
NZD$0.04861111

Resident Withholding Tax per
financial product
NZD$0.00868056
Section 4: Distribution re-investment plan
DRP % discount (if any)
2%
Start date and end date for
determining market price for DRP
18 March 2021

24 March 2021

Date strike price to be announced (if
not available at this time)
25 March 2021
Specify source of financial products to
be issued under DRP programme
(new issue or to be bought on market)
New Issue
DRP strike price per financial product

Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms
22 March 2021
Section 5: Authority for this announcement
Name of person

authorised to make
this announcement
Stefan Knight, Finance Director (CFO)
Contact person for this
announcement
Alastair White, GM Capital Markets
Contact phone number +64 (0) 21 228 3855
Contact email address investor-info@spark.co.nz
Date of release through MAP

24 February 2021

---

Spark New Zealand
H1 FY21 Results Summary
Jolie Hodson, Chief Executive Officer
Stefan Knight, Finance Director

Results overview

H1 FY21 snapshot
EBITDAI
(2)
$502m
REVENUE
(1)
$1,796m
NPAT
$148m
0.4% increase from H1 FY20
(1.5%) decrease from H1 FY20
(11.4%) decrease from H1 FY20
4.6% increase from H1 FY20
$229m
CLOUDREVENUE
(5)
(1)
Operating revenues and other gains
(2)
Earnings before finance income and expense, income tax, depreciation, amortisation and net investment income (EBITDAI) is a non-Generally Accepted Accounting Practice performance measure that is defined and reconciled to net earnings
in Spark New Zealand’s Interim Financial Statements
(3)
Subject to no adverse change in operating outlook
(4)
The calculation of free cash flow is defined within the ‘cash flows’ worksheet of the H1 FY21 detailed financials
(5)
Cloud, security & service management revenue
3
H1 FY21 DIVIDEND
12.5c
Total FY21 Dividend Guidance
confirmed at 25.0cps
(3)
FREE CASH FLOW
(4)
$113m
126% increase from H1 FY20

First half operating conditions
New Zealand’s economy recovering sooner than expected, however the recent Auckland lockdown
demonstrates uncertainty remains.
Early indications of lower billing and collection risk – however, Government stimulus may continue to
mask the full extent of the impact.
Decline in overall mobile market revenue
(1)
due to border closures and loss of roaming revenues.
The broadband and prepaid markets were impacted as border closures resulted in approximately
44,000 fewer people migrating to New Zealand
(2)
in H1 FY21 vs. H1 FY20.
Demand for collaboration tools to enable flexible working and business continuity with flexible cloud-
based “as a service” offerings increasing, but at a slower rate due to economic uncertainty.
Accelerated cost reduction programme to mitigate impacts of COVID-19.
Supporting New Zealand’s recovery by investing in critical 5G infrastructure, digital skills for small
business, and bridging the digital divide for vulnerable communities.
(1)
Market share estimates sourced from IDC
(2)
Source: Statistics New Zealand
4

5
H1 FY21 Established Market Performance
WIRELESS CLOUD
Mobile service revenue market share
(1)
at 40.4%, up 0.2pp from H1 FY20
driven by pay monthly connection
growth of 68k YoY
MOBILE
Mobile service revenue down 1.2%
to $420m due to loss of $21m
higher-margin outbound roaming
revenue
Underlying performance remains
strong – after stripping out the impact
of the loss of roaming, mobile service
revenue
(2)
up 3.8%
Prepaidconnections down in line with
market, ARPU up 8.1% ascustomers
shift to Endlessplans
(3)
Remain committed to target of ~30-40%
of base on wireless by FY23 – 5G rollout
growing addressable base and precision
marketing improving acquisition
BROADBAND
23% of base on wireless – 165k
customers, up from 156k at 30 June 2020
Aggressive competitor acquisition activity
and execution challenges during
COVID-19 disruption
Broadband market impacted –
~44k less people migrating to New
Zealand in H1 FY21 vs. H1 FY20
CLOUD, SECURITY AND
SERVICE MANEMENT
Cloud, security and service management
revenue up 4.6% YoY
Annuity revenue accounting for ~84% of
cloud, security and service management
revenues
Strong revenue momentum in service
management with completed transitions
successfully converting into ongoing
programmes of work
Collaboration revenue up 4.2% YoY as
COVID-19 increased demand for
collaboration products in support of
flexible working
(1)
Market share estimates sourced from IDC
(2)
Adjusted to include $21m of outbound roaming revenue as a result of COVID-19. NOTE: inbound roaming is reported in mobile non-service revenue
(3)
IDC market estimates show overall prepaid connection decline of ~9%. Spark prepaid connections down 134k YoY as a result of border closures and reduced immigration with ~44k fewer people migrating in H1 FY21 vs H1 FY20.

6
•Simplification progressing at pace – over 100 legacy plans retired in the half
•18% YoY reduction in total customer care interactions driven by improving digital self-service
•Launched NextGen Spark App with enhanced digital journey functionality
•Some impacts to iNPSas a new frontline operating model was introduced, aimed at cross-skilling
to deliverbetter customer experiencesand improved productivity
SIMPLE, INTUITIVE
CUSTOMER
EXPERIENCES
•Expansion of customer base in household view model leading to a 9% YoY improvement in
marketing efficiency
•Propensity models developed to better target plan and device offers to Skinny customers
•Continued progress in cloud migration with 3 core systems migrated during the period
DEEP
CUSTOMER
INSIGHTS
SMART,
AUTOMATED
NETWORK
•5G launched in Auckland, Dunedin, Palmerston North, New Plymouth, TeAwamutu and now
live testing in Christchurch
•OTN2.0
(1)
commissioned to support automation, self-healing of the network and resilience
•Infrastructure asset review to identify further opportunities to create value (see slide 8)
•Continuing to build Agile maturity across all parts of business
•New ways of working policy introduced to support flexibility, adapt to COVID-19 impacts and
grow engagement
•Digital leadership development and talent management programmes delivered to significant
portion of leadership population
GROWTH
MINDSETS
Strategic Update: World Class Capabilities and Culture
(1)
Optical Transport Network
Building the foundation to ignite revenue momentum as market conditions improve

Strategic Update: Future Markets
IoT
(1)
Digital
Health
Sport
7
•Summer of Cricket:great customer feedback on production and viewing experience during first two
tours (West Indies and Pakistan)
•High viewership: more than 3 million hours of cricket viewed to date
•Successful launch of Pay-Per-View boxing events: providing new revenue stream
•Leveraging Spark data capability: to increase the cross-sell of Spark Sport to existing customers
•IoT connection growth:65% YoY demonstrating strong demand for service offerings
•Growing awareness:Connecting NZ to the things that matter national advertising campaign launched
•Sector product development: water metering devices and platform launched
•Spark My IoT Platform: live and in trial with customers
•Tailored telco and IT services delivered: at a time of unprecedented demand in the health sector
•Digital Health Platform: significant progress towards launch
•Next Generation Health 5G Starter Fund: and 2021 Spark Health Innovation Programme launched
(1)
Internet of Things

Opportunities to grow the value of Infrastructure assets
8
1,500 mobile sites
Increased interestin quality infrastructure assets.
Spark has a significant infrastructure asset portfolio.
We continue to review investment and partnership
opportunities that make commercial sense and
maintain our competitive advantage.
Our aim is to drive greater capital efficiency,
increased resilience and better experiences for
customers.
We will provide an update at our full year results.
18 Data Centres
(1)
Satellite station
1,200 km national fibre
backhaul network
Metro and regional
data networks
fibre/wireless
Ownership stake in
3 sub-sea cables
35 major network sites
SPARK INFRASTRUCTURE ASSETS
(1)
Combination of Tier 2 and 3 facilities

FY21 indicators of success
Strategic PillarFocus AreaMeasureTarget 30 June 2021Status
World Class Capability
Customer
Experience
Consumer and small business iNPS8 point liftImprovement needed
(1)
Data driven insights80% of customer base
(2)
in household view
(3)
enabling
15% efficiency gain in
marketing spend
On Track
Wireless futureProgressive rollout of 5GLive in 5-7 locationsOn Track
Mature Agile
Leadership
Percentage of Agile squads at or above level 3.585%On Track
Grow established markets
WirelessMobile service revenue growth0-3%Impacted by COVID-19
WirelessWireless broadband connections+40kImprovement needed
CloudCloud, security and service management revenue growth5-8%On Track
Accelerate future markets
IoTGrowth in number of connected IoT devices50%Ahead
Spark SportSuccessfully deliver season 1 of New Zealand cricket
Platform availability of
99.9%
On Track
Lowest Cost ProviderDeliver best costEBITDAI margin 31%On Track
Build a sustainable future
Championing digital
equity
Skinny Jump connections+10kImprovement needed
Sustainable Spark
Set emissions reductions target aligned to New Zealand
being carbon neutral by 2050
(4)
By 30 June 2021On Track
(1)
The iNPSscore has been rebased to include an even larger sample of customer interaction feedback
(2)
Spark and Skinny consumer and Spark SME customer base
(3)
Household view is an insights platform that allows us to better anticipate the needs of New Zealand households to deliver more targeted, relevant and personalised services
(4)
As part of commitment to Climate Leaders Coalition
9

Financials

Financial summary
Disciplined cost management delivering stable EBITDAI despite ongoing impacts of COVID-19
(1)
Subject to no adverse change in operating outlook
$2m
0.4%
EBITDAI
movement
vs. H1 FY20
($19m)
(11.4%)
NPAT
movement
vs. H1 FY20
11
Top line revenue of $1,796m, $28m or 1.5% down on prior year due to:
•Mobile service revenue decline due to loss of high-margin roaming revenue; and
•Higher rate of voice revenue decline due to non-recurring provision to refund historical wire
maintenance charges.
Operating expenses down $30m, or 2.3% YoY, with $68m of gross cost-out benefits offsetting revenue
decline.
($28m)
(1.5%)
Revenue
movement
vs. H1 FY20
$30m
2.3%
Opex
movement
vs. H1 FY20
Reported EBITDAI of $502m, 0.4% up on prior yeardespite impacts of COVID-19 as a result of strong cost
management.
NPAT down$19m, or 11.4% YoY, primarily driven bya $29m increase in depreciation and amortisation
expense as a result of:
•The shift to shorter asset lives and increased right of use asset depreciation due to FY20 customer
related lease activity and retail property leases.
•D&A expected to increase over the near term as a result of shorter asset lives and spectrum renewals
and purchases before reducing to align with capital investment in the longer term.
Free cash flow of $113m, up $63m Yo Y, due to tight management of working capital resulting in higher cash
conversation rate of 102%.
Net debt of $1,400m, up $51m YoY. Reported net debt to EBITDAI ratio within Spark’s internal threshold of 1.4x.
H1 FY21 dividendper share of 12.5cps to be 100% imputed.Total FY21 dividend guidance
(1)
confirmed
at25.0cps as a result of strong free cashflow. Dividend Reinvestment Plan (DRP) retained with 2% discount.
$63m
126%
Free cash flow
movement
vs. H1 FY20
12.5cps
-%
H1 FY21
Dividend
vs. H1 FY20

Financials
H1 FY20
$m
H1 FY21
$m
CHANGE
Operating revenues and other gains1,8241,796(1.5%)
Operating expenses(1,324)(1,294)(2.3%)
EBITDAI5005020.4%
Finance income1817(5.6%)
Finance expense(46)(43)(6.5%)
Depreciation and amortisation(234)(263)(12.4%)
Net investment income(1)-100%
Net earnings before tax expense237213(10.1%)
Tax expense(70)(65)(7.1%)
Net earnings after tax expense167148(11.4%)
Capital expenditure247192(22.3%)
Free cash flow
(1)
50113126%
EBITDAI margin27.4%28.0%0.6pp
Effective tax rate29.5%30.5%1.0pp
Capital expenditure to operating revenues13.5%10.7%(2.8pp)
Earnings per Share9.18.0(12.1%)
Total Dividend per Share12.5c12.5c-
(1)
The calculation of free cash flow is defined within the ‘cash flows’ worksheet of the H1 FY21 detailed financials
12

Revenue
H1 FY21 revenue down 1.5% due to COVID-19 impacts and one-off provision
H1 FY21 revenue impacts include:
•Higher voice revenue decline of 20.6% due to non-recurring provision of $17m
to refund historical wire maintenance charges (underlying decline of 12.1% in line
with previous trends);
•Other operating revenue decline includes timing of Spark Sport revenue with
summer of cricket commencing in late November;
•Broadband revenues impacted by lower overall market growth
(2)
and aggressive
competitor activity;
•Mobile service revenue decline of $5m or 1.2%. Loss of ~$26m high margin
mobile roaming revenuedue to ongoing travel restrictions and border closures
as a result of COVID-19. Strong underlying growth of $16m or 3.8% when
adjusted for loss of roaming revenue
(1)
; and
•Cloud, security and service management up $10m or 4.6% driven by higher
annuity revenues and growth in Leaven, highlighting the benefits of business
transformation service management offerings particularly in a COVID-19 context.
FY21 revenue likely to be broadly flat reflective of the economic
environment and ongoing impacts of COVID-19.
13
(1)
Adjusted to include $21m of outbound roaming revenue as a result of COVID-19. NOTE: inbound roaming is reported in mobile non-service revenue
(2)
Market share estimates sourced from IDC
1,824
1,796
2
3
10
29
(41)
(18)
(8)
(5)
1,750
1,770
1,790
1,810
1,830
H1 FY20VoiceOther operatingBroadbandMobile serviceManaged data,
network &
services
Other mobileCloud, security
& service
management
Procurement &
partners
H1 FY21
Revenue H1 FY20 vs H1 FY21 ($m)
(1.5%)
Includes $17m provision for
historical wire maintenance
Mobile service impacted by
$21m loss of outbound roaming
revenue
Other mobile impacted by
$5m loss of inbound
roaming revenue

Operating expenses
•$68m of gross cost-out delivered in H1 across product, other operating
expenses and labour.
•Reduction in product costs due to lower Spark Sport
(1)
costs and divestment of
Lightbox, offset by procurement related cost of sales.
•Decline in other operating expenses driven by:
oLower bad debts as Government stimulus supports the economy;
oDecline in travel expenses; and
oReduction in marketing spend due to precision marketing efficiencies.
•Decrease in net labour costs of $12m or 4.5% YoY due to:
oDivestment of CCL networks business
(2)
;
oLegacy business resources reducing in line with ongoing transition to
digital journeys and expanded self service options; and
oIncreased capitalisation of labour.
Operating expenses down 2.3% with targeted cost out programme offsetting revenue impacts
Robust cost out programme to offset impacts of COVID-19
continues into H2 targeting reductions in excess of FY20.
14
(1)
Full cost of RWC 2019 was expensed during H1 FY20. H1 FY21 cricket only launched in late November
(2)
Divestment of CCL Network completed in January 2020
(3)
Investment in support of growth includes increases in labour in support of cloud, security and service management
revenue growth, Leaven, Digital Health and service operations
1,324
1,294
(6)
(12)
(12)
1,280
1,290
1,300
1,310
1,320
1,330
H1 FY20ProductLabourOtherH1 FY21
Expenses H1 FY20 vs H1 FY21 ($m)
(2.3%)
Includes $8m
of cost out
Includes $44m
of cost out
Includes $16m
of cost out
267
255
-
-
10
(16)
(6)
240
245
250
255
260
265
270
H1 FY20Gross labour cost reductionHigher capitalisationInvestment in support of
revenue growth
H1 FY21
Net Labour H1 FY20 vs H1 FY21 ($m)
(3)

EBITDAI
•EBITDAI maintained through early intervention around cost
during COVID-19 lockdowns and then capitalising on
improving market conditions to ignite revenue momentum.
•H1 FY21 COVID-19 impacts of ~$27m, strong
underlyingEBITDAI momentum.
•EBITDAI margin of 28% - on track for FY21 aspiration of 31%.
Maintained EBITDAI through strong operational and cost disciplines despite impacts of COVID-19
•Impact of COVID-19 in FY21 expected to be less material at
~$50m, vs. original estimate of $75m.This will be partially
offset by non-recurring cumulative wire maintenance provision
of $17m.
•H2 FY21 EBITDAI expected to benefit from stable revenues and
continuation of cost-out programme.
15
500
502
30
(28)
460
480
500
520
540
H1 FY20RevenueOperating expensesH1 FY21
EBITDAI H1 FY20 vs H1 FY21 ($m)
+0.4%

Capital investment
Capitalexpenditure ($m)
H1
FY20
H1
FY21
Mobile network9258
IT systems7366
Core sustain and resiliency5034
Cloud
(1)
169
Converged Communications Network (CCN)1115
International cable construction and capacity
(2)
01
Other
(3)
59
Total capital expenditure247192
Total capital expenditure to operating revenue 13.5%10.7%
(1)
Reduction in Cloud spend due to divestment of CCL networks business and shift towards leasing construct
(2)
International cable includes capacity purchases on Southern Cross cable and investment in Tasman Global Access cable
(3)
Increase in other investments due to new retail store fit outs including new flagship store in the Commercial Bay precinct
$55m reduction in spend on prior year, consistent with targeted reduction in full-year capital envelope from ~$370m to
~$350m excluding spectrum investment of $50m
•Strong focus on more actively managing phasing of capital
expenditure over the financial year, with 55% spent in H1
FY21, versus 66% in H1 FY20.
•Mobile and core network investment was high in H1
FY20in support of heavy network investment in the lead up
tothe Rugby World Cup.
•Ongoing investment in mobile network in support of
increased capacity and 5G rollout.
•Reduction in IT system investment in line with expectations.
•Investment in Converged Communications Network (CCN)
continues, with the South Island resiliency initiative added
to scope in H1 FY21.
Prioritised allocation of capex combined with long-term
investments in mobile spectrum of $50m resulting in greater
overall investment in FY21 versus FY20.
16

Net debt
Total net debt of $1,400m, up $51m YoY. Net debt to EBITDAI ratio within Spark’s internal threshold of 1.4x
•Reported net debt to EBITDAI ratio of 1.35x
(1)
consistent
with S&P A- credit rating.
•Net debt expected to reduce during H2 FY21 due to:
oSeasonal weighting of EBITDAI towards H2;
oPlanned reduction in capital investment, with H2
spend lower than H1;
oOngoing working capital improvements; and
oStrong DRP
(4)
participation.
(1)
Spark’s internal capital management policy is to ensure that on a long-run basis reported net debt to EBITDAI does not exceed 1.4x; which Spark estimates is approximately equivalent to S&P’s 1.7x adjusted net debt to EBITDA threshold.
Spark’s internal threshold of 1.4x excludes S&P’s adjustments in relation to IFRS16, and captive finance operations
(2)
Businessacquisitions and minority investments include Rural Connectivity Group and joint venture equity contributions
(3)
Proceeds from strategic Lightbox divestment
(4)
Dividend Reinvestment Plan remains in place for H1 FY21 dividend. Shares issued under the Dividend Reinvestment Plan will be issued at a 2% discount to the prevailing market price as determined around the time of issue
17
Spectrum renewal payments for 1800MHz and 2100MHz
paid for in January 2021 now expected to be funded by free
cash flow
1,349
1,400
167
4
1
(113)
(8)
1,150
1,250
1,350
1,450
Net debt as at 30
June 2020
Free cash flowDividends paidBusiness acquisitions
and minority
investments
Proceeds from asset
and business sales
Other movementsNet debt as at 31
December 2020
Movement in net debt during FY21 ($m)
(2)
(3)

Free cash flow
Free cash flow of $113m, up $63m YoY, due to active management of working capital and higher cash conversation
rate of 102%
EBITDAI
$502m
CAPEX
$192m
WORKING CAPITAL
$42m
FREE CASH FLOW
(1)
$113m
0.4% increase from H1 FY20
22.3% decrease from H1 FY20
Improvement in working capital
from H1 FY20
126% increase from H1 FY20
H1 FY21
free cash flow
growth driven by:
FY21 free cash flow aspiration of $420m-$460m sufficient to fund shareholder distributions of 25.0cps
(2)
after taking into account
impact of dividend reinvestment plan
(3)
.
H2 FY21 free cashflow driven by:
(1)
The calculation of free cash flow is defined within the ‘cash flows’ worksheet of the H1 FY21 detailed financials
(2)
Subject to no adverse change in operating outlook
(3)
Dividend Reinvestment Plan remains in place for H1 FY21 dividend. Shares issued under the Dividend Reinvestment Plan will be issued at a 2% discount to the prevailing market price as determined around the time of issue
18
1
2
3
EBITDAI Seasonality
Phasing of capital
expenditure
Ongoing
improvement in
working capital
~55% of EBITDAI delivered in H2
~55% of FY21 capex already incurred
4
Timing of tax
payments
2 out of 3 annual income tax payments
paid in H1

Guidance
(1)
FY20 ActualPrevious FY21
Guidance
FY21 Spectrum
Renewals
(2)
Change to FY21
Guidance
EBITDAI
$1,113m$1,090m to $1,130m-$1,100m to $1,130m
Capital
expenditure
$374m~$350m$50m
-
Dividend per share
Ordinary 25.0cps
H1 FY20
(75% imputed)
H2 FY20
(100% imputed)
Ordinary 23-25cps
( 100% imputed)
-
Ordinary 25.0cps
(3)
(100% imputed)
(1)
Subject to no adverse change in operating outlook
(2)
1800MHz and 2100MHz spectrum renewals paid in January 2021
(3)
Dividend Reinvestment Plan remains in place for H1 FY21 dividend. Shares issued under the Dividend Reinvestment Plan will be issued at a 2% discount to the prevailing market price as determined around the time of issue
19

Managed Services
Presentation
Wednesday 24 March 2021
10.00am
SAVE
THE
DATE

Disclaimer
This announcement may include forward-looking statements regarding future events and the future financial performance of Spark New
Zealand. Such forward-looking statements are based on the beliefs of and assumptions made by management along with information
currently available at the time such statements were made.
These forward-looking statements may be identified by words such as ‘guidance’, ‘anticipate’, ‘believe’, ‘estimate’, ‘expect’, ‘intend’, ‘will’,
‘plan’, ‘may’, ‘could’, ‘ambition’, ‘aspiration’ and similar expressions. Any statements in this announcement that are not historical facts are
forward-looking statements. These forward-looking statements are not guarantees or predictions of future performance, and involve
known and unknown risks, uncertainties and other factors, many of which are beyond Spark New Zealand’s control, and which may
cause actual results to differ materially from those projected in the forward-looking statements contained in this announcement.
Factors that could cause actual results or performance to differ materially from those expressed or implied in the forward-looking
statements are discussed herein and also include Spark New Zealand's anticipated growth strategies, Spark New Zealand's future results
of operations and financial condition, economic conditions and the regulatory environment in New Zealand, competition in the markets
in which Spark New Zealand operates, risks related to the sharing arrangements with Chorus, any impacts or risks to Spark’s anticipated
growth strategies, future financial condition and operations, economic conditions or the regulatory environment in New Zealand arising
from or otherwise with COVID-19, other factors or trends affecting the telecommunications industry generally and Spark New Zealand’s
financial condition in particular and risks detailed in Spark New Zealand's filings with NZX and ASX. Except as required by law or the
listing rules of the stock exchanges on which Spark New Zealand is listed, Spark New Zealand undertakes no obligation to update any
forward-looking statements whether as a result of new information, future events or otherwise.

---

Spark New Zealand
Group result - reported
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Operating revenues and other gains1,7541,7791,8241,7991,7961,8241,796(28)(1.5%)
Operating expenses(1,265)(1,178)(1,324)(1,186)(1,294)(1,324)(1,294)302.3%
EBITDAI48960150061350250050220.4%
Finance income18191818171817(1)(5.6%)
Finance expense(40)(45)(46)(48)(43)(46)(43)36.5%
Depreciation and amortisation expense(245)(232)(234)(245)(263)(234)(263)(29)(12.4%)
Net investment income-14(1)2-(1)-1100.0%
Net earnings before income tax222357237340213237213(24)(10.1%)
Tax expense(69)(101)(70)(80)(65)(70)(65)57.1%
Net earnings for the period153256167260148167148(19)(11.4%)
Capital expenditure264153247127192247192(55)(22.3%)
Free cash flows
108184503881135011363NM
Reported EBITDAI margin27.9%33.8%27.4%34.1%28.0%27.4%28.0%0.6%
Reported effective tax rate31.1%28.3%29.5%23.5%30.5%29.5%30.5%1.0%
Capital expenditure to operating revenues15.1%8.6%13.5%7.1%10.7%13.5%10.7%(2.8%)
Reported basic and diluted earnings per share (cents)8.314.09.114.18.09.18.0-1.1(12.1%)
Gross margin by product
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Mobile376399405424407
40540720.5%
Voice14313912412190
12490(34)(27.4%)
Broadband168176175166166
175166(9)(5.1%)
Cloud, security and service management163164176177179
17617931.7%
Procurement and partners1825212521
2121--%
Managed data, network and services6666656468
656834.6%
Other product2526153328
15281386.7%
Total product gross margin9599959811,010959
981959(22)(2.2%)
Other gains-154314
44--%
Total gross margin9591,0109851,041963
985963(22)(2.2%)
Connections
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
000's000's000's000's000's000's000's000's
%
Mobile connections
1
2,464 2,515 2,500 2,519 2,431 2,500 2,431 (69) (2.8%)
Voice connections by type
2
POTS & ISDN356329288220197288197(91)(31.6%)
VoIP576266738466841827.3%
Voice over wireless18262624232623(3)(11.5%)
431417380317304380304(76)(20.0%)
Broadband connections
Copper296249211186157211157(54)(25.6%)
Fibre2733063403673813403814112.1%
Wireless1291401411561651411652417.0%
698695692709703692703111.6%
1 Mobile connections excluding MVNO connections but including legacy machine to machine and SIM based SmartWatch connections
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
2
Voice connections include all voice technology types, including POTS, ISDN, VoIP and wireless voice. Voice connections exclude connections
where Spark also provide a bundled broadband service, but include all wholesale voice connections (including those where the underlying
customer has a bundled broadband service).

Spark New Zealand
Group FTE's
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
%
FTE permanent5,1075,1095,1194,9834,9615,1194,961(158)(3.1%)
FTE contractors 212167200146121200121(79)(39.5%)
Total FTE5,3195,2765,3195,1295,0825,3195,082(237)(4.5%)
Dividends
H1 FY20H1 FY21
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21$$$
%
Ordinary dividends (cents per share)11.0011.0012.5012.5012.5012.5012.50--%
Special dividends (cents per share)1.501.50------NM
12.5012.5012.5012.5012.5012.5012.50--%
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21

Spark New Zealand
Group operating revenues and other gains
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Operating revenues
Mobile
Service revenue403413425423420425420(5)(1.2%)
Non-service revenue21923622821223122823131.3%
622649653635651653651(2)(0.3%)
Voice
Access1091059788669766(31)(32.0%)
Calling87837981717971(8)(10.1%)
Other voice revenue29282323212321(2)(8.7%)
225216199192158199158(41)(20.6%)
Broadband344341345335337345337(8)(2.3%)
Cloud, security and service management195205219224229219229104.6%
Procurement and partners1911742082002372082372913.9%
Managed data, network and services12112112112712312112321.7%
Other operating revenue56587555577557(18)(24.0%)
Total operating revenues1,7541,7641,8201,7681,7921,8201,792(28)(1.5%)
Other gains-15431444--%
Total operating revenues and other gains1,7541,7791,8241,7991,7961,8241,796(28)(1.5%)
Operating revenues includes revenues from Consumer, Business, Wholesale and other customer segments.
Wireless broadband revenues and connections are included in broadband revenues and connections.
Operating revenues and other gains by customer segment
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Operating revenues and other gains$m$m$m$m$m$m$m$m
%
Consumer790814825757769825769(56)(6.8%)
Business861851906920940906940343.8%
Wholesale and other124137119148113119113(6)(5.0%)
Eliminations(21)(23)(26)(26)(26)(26)(26)--%
1,7541,7791,8241,7991,7961,8241,796(28)(1.5%)
Finance income
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Finance income$m$m$m$m$m$m$m$m
%
Finance lease interest income7776676(1)(14.3%)
Other interest income11121112111111--%
18191818171817(1)(5.6%)
Net investment income
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Net investment income$m$m$m$m$m$m$m$m
%
Dividend income-15------NM
Share of associates' and joint ventures' net losses-(1)(1)2-(1)-1100.0%
-14(1)2-(1)-1100.0%
Revenue classification changes
Customer segment lineServices providedPrevious customer segmentCurrent customer segment
Internet of things
BusinessOther
Provision of internet-connected
objects that are able to connect and
transfer data over a wireless network
without human intervention
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
As part of the ongoing revision of the Agile business model, the management of certain customer segment lines have been reallocated from one
part of the business to another. The details of the key changes and the associated impact on revenue reporting are as follows:

Spark New Zealand
Group operating expenses
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Product costs
Mobile246250248211244248244(4)(1.6%)
Voice82777571687568(7)(9.3%)
Broadband17616517016917117017110.6%
Cloud, security and service management32414347504350716.3%
Procurement and partners1731491871752161872162915.5%
Managed data, network and services55555663555655(1)(1.8%)
Other product costs31326022296029(31)(51.7%)
795769839758833839833(6)(0.7%)
Labour250225267244255267255(12)(4.5%)
Other operating expenses
Network support costs37243530433543822.9%
Computer costs4647494951495124.1%
Accommodation costs37303330323332(1)(3.0%)
Advertising, promotions and communication47404731444744(3)(6.4%)
Bad debts66710(1)7(1)(8)NM
Impairment expense5(2)-2----NM
Other42394732374737(10)(21.3%)
220184218184206218206(12)(5.5%)
Total operating expenses1,2651,1781,3241,1861,2941,3241,294(30)(2.3%)
Finance expense
Finance expense on debt23252528212521(4)(16.0%)
Other interest and finance expense4775676(1)(14.3%)
Lease interest expense15151516151515--%
Leased customer equipment interest expense2233434133.3%
44495052465046(4)(8.0%)
Capitalised interest(4)(4)(4)(4)(3)(4)(3)125.0%
40454648434643(3)(6.5%)
Depreciation and amortisation expense
Depreciation - property, plant and equipment12811811911412411912454.2%
Depreciation - right-of-use assets25312836352835725.0%
Depreciation - leased customer equipment assets991512191519426.7%
Amortisation of intangibles837472838572851318.1%
2452322342452632342632912.4%
H1 FY20 v H1 FY21

Spark New Zealand
Analysis & KPI's - Mobile
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Mobile revenue by type (Consumer and Business)$m$m$m$m$m$m$m$m
%
Mobile service revenue398409421419415421415(6)(1.4%)
Mobile non-service revenue
1
20622421619722321622373.2%
60463363761663863763810.2%
18161619131613(3)(18.8%)
Total mobile revenue622649653635651653651(2)(0.3%)
Mobile product costs
3
(246) (250) (248) (211) (244) (248) (244) 4 1.6%
Mobile gross margin37639940542440740540720.5%
Mobile gross margin %60.5%61.5%62.0%66.8%62.5%62.0%62.5%0.5%
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Total mobile revenue by customer segment$m$m$m$m$m$m$m$m
%
Consumer410443443419438443438(5)(1.1%)
Business19419019419720019420063.1%
Wholesale and other18161619131613(3)(18.8%)
622649653635651653651(2)(0.3%)
Average revenue per user (ARPU) - 6 month active
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Consumer and Business
$ per
month
$ per
month
$ per
month
$ per
month
$ per
month
$ per
month
$ per
month
$ per
month %
Total ARPU27.5627.5728.4828.0528.5128.4828.510.03 0.1%
Pay-monthly ARPU42.8242.4342.8241.1939.9742.8239.97(2.85)(6.7%)
Prepaid ARPU12.2912.6613.2813.3714.3613.2814.361.08 8.1%
H1 FY19 H2 FY19 H1 FY20 H2 FY20 H1 FY21 H1 FY20 H1 FY21
000's000's000's000's000's000's000's000's
%
Pay-monthly connections1,2251,2511,2871,3301,3551,2871,355685.3%
Prepaid connections1,2061,2321,1811,1611,0471,1811,047(134)(11.3%)
Internal connections4444444--%
Total mobile connections2,4352,4872,4722,4952,4062,4722,406(66)(2.7%)
1
Mobile non-service revenue includes handset sales and mobile interconnect.
2
Includes MVNO revenue.
3
Includes handset, interconnect and cellphone tower access costs.
4
Excludes MVNO connections but includes SIM based SmartWatch connections
H1 FY20 v H1 FY21
Wholesale and other customer segment mobile
revenue
2
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
Number of mobile connections at period end - 6
month active - Consumer and Business
4
H1 FY20 v H1 FY21

Spark New Zealand
Analysis & KPI's - Voice
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
Revenue by type$m$m$m$m$m$m$m$m
%
Access1091059788669766(31)(32.0%)
Calling87837981717971(8)(10.1%)
Other voice revenue29282323212321(2)(8.7%)
Total voice revenue225216199192158199158(41)(20.6%)
Voice product costs
1
(82) (77) (75) (71) (68) (75) (68)7 9.3%
Voice gross margin1431391241219012490(34)(27.4%)
Voice gross margin %63.6%64.4%62.3%63.0%57.0%62.3%57.0%(5.3%)
H1 FY19 H2 FY19 H1 FY20 H2 FY20 H1 FY21 H1 FY20 H1 FY21
000's000's000's000's000's000's000's000's
%
POTS and ISDN356329288220197288197(91)(31.6%)
VoIP576266738466841827.3%
Voice over wireless18262624232623(3)(11.5%)
Total voice connections431417380317304380304(76)(20.0%)
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
000's000's000's000's000's000's000's000's
%
Consumer1041039349589358(35)(37.6%)
Business177178173169165173165(8)(4.6%)
Wholesale and other150136114998211482(32)(28.1%)
Total voice connections431417380317305380305(75)(19.7%)
1
Includes voice access (baseband), interconnect, and international calling costs.
Analysis & KPI's - Broadband
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Total broadband revenue344341345335337345337(8)(2.3%)
Broadband product costs
2
(176) (165) (170) (169) (171) (170) (171) (1) (0.6%)
Broadband gross margin168176175166166175166(9)(5.1%)
Broadband gross margin %48.8%51.6%50.7%49.6%49.3%50.7%49.3%(1.4%)
H1 FY19 H2 FY19 H1 FY20 H2 FY20 H1 FY21 H1 FY20 H1 FY21
000's000's000's000's000's000's000's000's
%
Copper296249211186157211157(54)(25.6%)
Fibre2733063403673813403814112.1%
Wireless1291401411561651411652417.0%
Total broadband connections698695692709703692703111.6%
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
000's000's000's000's000's000's000's000's
%
Consumer598593587595585587585(2)(0.3%)
Business989910010310310010333.0%
Wholesale and other235111551510NM
Total broadband connections698695692709703692703111.6%
2
Includes broadband access (UBA/UCLL/Fibre), modem and e-mail platform support costs.
Broadband connections by technology
H1 FY20 v H1 FY21
Broadband connections by segment
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21
Voice connections by type
H1 FY20 v H1 FY21
Voice connections by customer segment
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21

Spark New Zealand
Analysis & KPI's - Cloud, Security and Service management
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Cloud, Security and Service management revenue195205219224229219229104.6%
Cloud, Security and Service management product costs(32)(41)(43)(47)(50)(43)(50)(7)(16.3%)
Cloud, Security and Service management gross margin16316417617717917617931.7%
Cloud, Security and Service management gross margin %83.6%80.0%80.4%79.0%78.2%80.4%78.2%(2.2%)
Contribution margin (approximated) %
1
36.4% 42.0% 34.2% 37.9% 32.8% 34.2% 32.8% (1.4%)
Analysis & KPI's - Procurement and Partners
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Procurement and partners revenue1911742082002372082372913.9%
Procurement and partners product costs(173)(149)(187)(175)(216)(187)(216)(29)(15.5%)
Procurement and partners gross margin18252125212121--%
Procurement and partners gross margin %9.4%14.4%10.1%12.5%8.9%10.1%8.9%(1.2%)
Analysis & KPI's - Managed data, network and services
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Collaboration2520242825242514.2%
Managed data and networks96101979998979811.0%
Managed data, network and services revenue12112112112712312112321.7%
Managed data, network and services product costs
2
(55) (55) (56) (63) (55) (56) (55) 1 1.8%
Managed data, network and services gross margin6666656468656834.6%
Managed data, network and services gross margin %54.5%54.5%53.7%50.4%55.3%53.7%55.3%1.6%
2
Includes wide area network access, international data, network backhaul and videoconferencing platform costs.
H1 FY20 v H1 FY21
1
Contribution margin is defined as reported gross margin less labour and other costs that are directly attributable to the implementation and
ongoing support of specific contract services.
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21

Spark New Zealand
Statement of cash flows
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Cash flows from operating activities
Cash received from customers 1,770 1,654 1,861 1,733 1,828
1,8611,828(33)(1.8%)
Interest receipts 18 17 17 17 16
1716(1)(5.9%)
Dividend receipts - 15 - - -
---NM
Payments to suppliers and employees (1,314) (1,169) (1,396) (1,101) (1,319)
(1,396)(1,319)775.5%
Payments for income tax (44) (91) (82) (58) (118)
(82)(118)(36)(43.9%)
Payments for interest on debt (22) (23) (26) (26) (23)
(26)(23)311.5%
Payments for interest on leases (13) (17) (14) (16) (16)
(14)(16)(2)(14.3%)
Payments for interest on leased customer equipment
assets
(2) (2) (3) (3) (4)(3) (4) (1) (33.3%)
Net cash flows from operating activities 393 384 357 546 364
35736472.0%
Cash flows from investing activities
Proceeds from sale of property, plant and equipment - 1 13 - -
13-(13)(100.0%)
Proceeds from sale of business - - - 23 8
-88NM
Proceeds from long-term investments - 2 - -
---NM
Payments for purchase of businesses - - (11) - -
(11)-11100.0%
Payments for, and advances to, long-term investments (6) - (30) (5) (4)
(30)(4)2686.7%
Payments for purchase of property, plant and
equipment and intangibles
(258) (157) (273) (120) (214) (273) (214) 59 21.6%
Payments for capitalised interest (3) (5) (4) (4) (3)
(4)(3)125.0%
Net cash flows from investing activities (267) (159) (305) (106) (213)
(305)(213)9230.2%
Cash flows from financing activities
Net proceeds from debt 182 (28) 207 (177) 100
207100(107)(51.7%)
Receipts from finance leases 3 3 2 4 2
22--%
Payments for dividends (229) (230) (229) (230) (167)
(229)(167)6227.1%
Payments for leases (19) (17) (19) (23) (20)
(19)(20)(1)(5.3%)
Payments for leased customer equipment assets (8) (9) (13) (15) (16)
(13)(16)(3)(23.1%)
Net cash flows from financing activities (71) (281) (52) (441) (101)
(52)(101)(49)(94.2%)
Net cash flow 55 (56) - (1) 50
-5050NM
Opening cash position 55 110 54 54 53
5453(1)(1.9%)
Closing cash position 110 54 54 53 103
541034990.7%
H1 FY20 v H1 FY21

Spark New Zealand
Analysis & KPIs - Free cash flows
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Net cash flows from operating activities
393 384 357 546 364 35736472.0%
Payments for purchase of property, plant and
equipment and intangibles
(258) (157) (273) (120) (214) (273) (214) 59 21.6%
Payments for capitalised interest
(3) (5) (4) (4) (3) (4)(3)125.0%
Payments for leases
(19) (17) (19) (23) (20) (19)(20)(1)(5.3%)
Payments for leased customer equipment assets
(8) (9) (13) (15) (16) (13)(16)(3)(23.1%)
Receipts from finance leases
3 3 2 4 2 22--%
excluding
---NM
Dividend receipts
- (15) - - - ---NM
Increase/(decrease) in working capital
38 99 31 (48) (11) 31(11)(42)NM
Underlying free cash flow146 283 81 340 102
811022125.9%
including
(Increase)/decrease in working capital
(38) (99) (31) 48 11 (31)1142NM
Free cashflow108 184 50 388 113
5011363126.0%
Analysis & KPIs - Movement in working capital
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
EBITDAI 489 601 500 613 502
50050220.4%
excluding
---NM
Impairments (5) 2 - (2) -
---NM
Other gains - 15 4 31 4
44--%
EBITDAI excluding impairments and other gains494 584 496 584 498
49649820.4%
Net cash flows from operating activities 393 384 357 546 364
35736472.0%
excluding
---NM
Interest receipts 18 17 17 17 16
1716(1)(5.9%)
Dividend receipts - 15 - - -
---NM
Payments for income tax (44) (91) (82) (58) (118)
(82)(118)(36)(43.9%)
Payments for interest on debt (22) (23) (26) (26) (23)
(26)(23)311.5%
Payments for interest on leases (13) (17) (14) (16) (16)
(14)(16)(2)(14.3%)
Payments for interest on leased customer equipment
assets
(2) (2) (3) (3) (4)(3) (4) (1) (33.3%)
Net cash flows from operating activities excluding
dividends, tax and net interest
456 485 465 632 509 465 509 44 9.5%
EBITDAI excluding impairments and other gains 494 584 496 584 498
49649820.4%
less
Net cash flows from operating activities excluding
dividends, tax and net interest
456 485 465 632 509 465 509 44 9.5%
Increase/(decrease) in working capital38 99 31 (48) (11) 31 (11) (42) (135.5%)
Cash conversion92%83%94%108%102%94%102%8%
H1 FY20 v H1 FY21
H1 FY20 v H1 FY21

Spark New Zealand
Group capital expenditure
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Cloud26101689169(7)(43.8%)
Converged Communications Network (CCN)201111715
1115436.4%
International cable construction and capacity purchases
111-111011NM
IT systems7062735666
7366(7)(9.6%)
Mobile network8929922458
9258(34)(37.0%)
Core sustain and resiliency3627501534
5034(16)(32.0%)
Other1213569
59480.0%
Total capital expenditure
264153247127192247192(55)(22.3%)
Analysis & KPI's - Capital expenditure depreciation and amortisation
H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H1 FY20H1 FY21
$m$m$m$m$m$m$m$m
%
Depreciation - property, plant and equipment12811811911412411912454.2%
Depreciation - right-of-use assets
1
913101111
1011110.0%
Amortisation of intangibles
837472838572851318.1%
Total capital expenditure depreciation and amortisation
220205201208220201220199.5%
1
Includes depreciation on capacity right-of-use assets only as these are included within Spark’s definition of capital expenditure.
H1 FY20 v H1 FY21
Capital expenditure is presented on an accruals basis, and includes purchase of property, plant and equipment and intangible assets, capacity
purchases (including Southern Cross) but excludes leased customer equipment assets.
On adoption of NZ IFRS 16 Leases, assets associated with capacity arrangements which were previously
recognised within intangible assets have been reclassified to right-of-use assets. Payments for capacity
purchases remain within Spark’s definition of capital expenditure. Total depreciation on property plant and
equipment, depreciation on capacity right-of-use assets and amortisation of intangibles is reconciled
H1 FY20 v H1 FY21