Chorus Q2 FY23 Connections update

Q2 FY23 Connections Update
25 January 2023

>The UFB rollout was completed in December with uptake remaining at 71% (rounded)
▪Chorus’ target of 1 million total fibre connections was achieved in mid-January, despite fibre connection growth in Q2
being affected by field workforce constraints
▪0.5% growth in uptake across all UFB areas with 75.5% (+0.5%) in UFB1 areas and 52% (+1%) in UFB2 areas
▪Auckland reached 80.5% (+0.5%) uptake, while Wellington grew to 70% (+1%) and some areas (e.g. Dunedin) saw
demand affected by student holidays
>Total broadband connections reduced 2k to 1,188,000* (Q1 FY23: +1k)
▪3k broadband connections were added in Chorus UFB areas
▪1Gbps and Hyperfibreconnections were 36% of mass market fibre adds in Q2
▪Hyperfibre(2-8Gbps) connections grew 23%, with monthly volumes lifting steadily
>Copper broadband and voice connections declined by 29k (Q1 FY23: -27k)
▪voice only disconnections were-10k(Q1 FY23: -8k)
▪copper withdrawal: 268copper broadband cabinets no longer have active customers (Q1 FY23: 177 cabinets)
▪CPI increase of 7.2% applied to copper baseband and copper broadband services from mid-December
▪total fixed line connections declined by 12k to 1,285,000* (Q1 FY23: -7k)
>Average monthly data usage on fibre was 555GB in December (Sept: 554GB)
▪~15% of fibre connections consume 1,000GB+ a month
25 January 2023
Q2 FY23 overview
Total fibre connections increased by 17k to 997,000 (Q1 FY23: +21k)
Q2 FY23 CONNECTIONS UPDATE
*totals exclude ~8,000 broadband
connections Chorus is partly subsidising
for student households
2

>Total UFB uptake of 71% (rounded) within completed
footprint in Q2
▪uptake in UFB1 areas grew from 75% to 75.5%
▪uptake in UFB2 areas grew from 51% to 52%
▪954,000 connections (Q1 FY23: 938,000) now within
completed footprint (includes business premium and partly
subsidised education connections)
▪1,342,000customers able to connect (Q1 FY23: 1,330,000)
>22,000fibre installations completed in Q2 (Q1 FY23: 26k)
▪customer satisfaction increased from 7.7 to 7.8
▪WIPreduced from 13k to 12k
▪field crews reduced from ~450 to ~380 due to resourcing
challenges
50%
55%
60%
65%
70%
75%
80%
85%
AucklandDunedinWellington
UFB uptake by quarter
Dec-21Mar-22Jun-22Sep-22Dec-22
UFB rollout completed in December 2022
Uptake
25 January 2023
Q2 FY23 CONNECTIONS UPDATE
▪Auckland, Wellington and Dunedin cover >70% of
UFB1 homes and businesses able to connect
▪93% of Chorus’ broadband connections in our
planned UFB zone are now on fibre
student
holidays
3

>300Mbps plans account for 68% of residential connections and 1Gbps connections 24%
>mass market Hyperfibre(2-8Gbps) connections grew 23% in Q2 with monthly volumes lifting steadily
>1Gbps and Hyperfibreconnections were 36% of mass market fibre adds in Q2
25 January 2023
Q2 FY23 CONNECTIONS UPDATE
Mass market fibre connections grew 17k
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Dec 2021Mar 2022June 2022Sept 2022Dec 2022
Residential
1Gbps300Mbps200Mbps100Mbps<100MbpsVoice
4
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
Dec 2021March 2022June 2022Sept 2022Dec 2022
Business
1Gbps500Mbps300Mbps200Mbps100Mbps<100MbpsVoice

0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
31-Dec-2131-Mar-2230-Jun-2230-Sep-2231-Dec-22
25 January 2023
31 Dec
2021
31 March
2022
30 June
2022
30 Sept
2022
31 Dec
2022
Unbundled copper
(no broadband)
6,0003,0001,0001,000not
material
Baseband copper
(no broadband)
119,000112,000102,00094,00085,000
Copper ADSL
(includes naked)
142,000133,000122,000112,000102,000
VDSL
(includes naked)
138,000128,000118,000109,000100,000
Fibre broadband
(GPON)
907,000929,000949,000969,000986,000
Data services
(copper)
2,0002,0002,0001,0001,000
Fibre premium
(P2P)
11,00010,00010,00011,00011,000
Total connections
1,325,0001,317,0001,304,0001,297,0001,285,000
Fibre (GPON)
VDSL
Copper ADSL
Baseband copper
Fibre comprises 78% of Chorus connections
>1,188,000 broadband connections comprises:
▪986,000 fibre (GPON) connections
▪202,000 VDSL/ADSL (copper) connections
Business premium
Note: 8,000 partly subsidisededucation connections are excluded from this data
Q2 FY23 CONNECTIONS UPDATE
5

25 January 2023
Connection changes by Zone (indicative as at 31 Dec)
* Excludes 8k partly subsidised education connections and 12k fibre premium and data services (copper) connections
3
6
4
7
9
-2
-2
-3
-2
-2
-3
-3
-2
-2
-3
-6
-6
-8
-7
-6
-2
-1
-2
-1
-2
-2
-1
-2
-2
-2
-10-50510
Q2 FY23
Q1 FY23
Q4 FY22
Q3 FY22
Q2 FY22
Q2 FY23
Q1 FY23
Q4 FY22
Q3 FY22
Q2 FY22
Q2 FY23
Q1 FY23
Q4 FY22
Q3 FY22
Q2 FY22
Broadband connections
Copper (no broadband) connections
Quarterly change (’000s) by zone*
Q2 FY23 CONNECTIONS UPDATE
Other fibre
company (LFC)
zone
Broadband connections29,000Local Fibre Company and fixed wireless provider
activity is driving a gradual decline in copper
connections.
Copper line (no broadband)16,000
TOTAL45,000
Non-UFB zoneBroadband connections138,000Gradual decline in copper connections due to
mobile/fixed wireless/satellite footprint
expansion. Partly offset by fibre connections
growth for greenfield developments.
Copper line (no broadband)26,000
TOTAL164,000
Chorus UFB zoneBroadband connections1,021,000Lower broadband growth in Q2 reflecting field
resource constraints. Continued reduction in
copper connections due to Chorus fibre migration
activity and fixed wireless/mobile competition.
Copper line (no broadband)43,000
TOTAL1,064,000
6

>successful focus on driving activation of installed
fibre sockets (ONTs)
▪10k sockets activated in Q2, up slightly from Q1
▪46% of activations were offnet addresses (Q1 FY23:
45%)
>installation activity via the managed migration
programme was reduced in Q2 given workforce
constraints
▪8k installations completed in Q2, down from 10k in Q1
25 January 2023
Managed migration programme lifts connections
0
2,000
4,000
6,000
8,000
10,000
12,000
Q2 FY22Q3 FY22Q4 FY22Q1 FY23Q2 FY23
Managed migration programme
InstallationsConnections
Q2 FY23 CONNECTIONS UPDATE
7

Monthly average data usage on fibre 555gigabytes
>Monthly average data usage grew from 504GB to 512GB
with most growth coming from copper broadband users
▪555GBon fibre (Sept:554GB)
▪308GBon copper (Sept:290GB)
▪512GBaverage across all connections (Sept:504GB)
>~15% of fibre connections consume 1,000GB+ a month
>Average peak throughput on our network at peak time
(~9pm) was 3.1Tbps in December
▪a single day peak of 4.0Tbps coincided with a Fortnite
update
25 January 2023
308
555
512
0
100
200
300
400
500
600
CopperFibreAverage
Data
usage
(GB)
Monthly average data usage per connection on
our network*
* includes upstream traffic from June 2020 onwards
Q2 FY23 CONNECTIONS UPDATE
8

25 January 2023
Commerce Commission broadband testing report
▪The Commerce Commission’s Measuring Broadband New Zealand, Spring Report (October 2022) continues to highlight
the strong performance of fibre relative to other technologies.
Q2 FY23 CONNECTIONS UPDATE
Source: Commerce Commission
9

---

Chorus Limited
Level 10, 1 Willis Street
P O Box 632
Wellington
New Zealand

Email: company.secretary@chorus.co.nz

STOCK EXCHANGE ANNOUNCEMENT

25 January 2023

Q2 FY23 overview

Total fibre connections increased by 17k to 997,000 (Q1 FY23: +21k)
The UFB rollout was completed in December with uptake remaining at 71% (rounded)
• Chorus’ target of 1 million total fibre connections was achieved in mid-January, despite fibre
connection growth in Q2 being affected by field workforce constraints
• 0.5% growth in uptake across all UFB areas with 75.5% (+0.5%) in UFB1 areas and 52% (+1%)
in UFB2 areas
• Auckland reached 80.5% (+0.5%) uptake, while Wellington grew to 70% (+1%) and some
areas (e.g. Dunedin) saw demand affected by student holidays
Total broadband connections reduced 2k to 1,188,000* (Q1 FY23: +1k)
• 3k broadband connections were added in Chorus UFB areas
• 1Gbps and Hyperfibre connections were 36% of mass market fibre adds in Q2
• Hyperfibre (2-8Gbps) connections grew 23%, with monthly volumes lifting steadily
Copper broadband and voice connections declined by 29k (Q1 FY23: -27k)
• voice only disconnections were -10k (Q1 FY23: -8k)
• copper withdrawal: 268 copper broadband cabinets no longer have active customers (Q1
FY23: 177 cabinets)
• CPI increase of 7.2% applied to copper baseband and copper broadband services from mid-
December
• total fixed line connections declined by 12k to 1,285,000* (Q1 FY23: -7k)
Average monthly data usage on fibre was 555GB in December (Sept: 554GB)
• ~15% of fibre connections consume 1,000GB+ a month
*totals exclude 8,000 broadband connections Chorus is partly subsidising for student households

Authorised by:
JB Rousselot
Chief Executive Officer

ENDS

For further information:

Steve Pettigrew
Head of External Communications
Mobile +64 (27) 258 6257
Email: Steve.Pettigrew@chorus.co.nz
Brett Jackson
Investor Relations Manager
Phone: +64 4 896 4039
Mobile: +64 (27) 488 7808
Email: Brett.Jackson@chorus.co.nz