When Telstra announced recently plans to buy back its retail stores and not renew licensing contracts shockwaves were felt across the retail telecommunication industry, with industry insiders keenly interested in what steps the retail store owners and long-time landlord Vita Holdings would take next. In press releases Telstra said the move was to “keep pace with the growing digital economy” and give the telco more flexibility to respond to customer needs.
Telstra's decision has meant the telco won’t renew Vita’s dealer agreement in 2025 and the company has said they will shift its focus to growing its skin health and wellness business, Artisan Aesthetic Clinics, whilst retaining a presence in the telco space with Telstra Business Technology Centres, which services small and medium businesses with mobility and IoT solutions, and technology accessories retailer Sprout as part of Vita’s ICT business. Other Vita brands include; Fone Zone, SQDAthletica and Vita Enterprise Solutions.
Vita said it is in discussions with Telstra to “ensure a suitable transition of value” for both parties, shareholders and team members.
Vita also released its financial results for the first half of FY2021, revealing profit growth year over year despite a sizable decline in revenue and a particularly challenging retail environment over the past 12 - 18 months with the global pandemic.
“We are pleased to have maintained profitability during a challenging period. Our progress in Artisan is strong and sustainable. The team has done an excellent job of managing our ICT channel and supporting Telstra customers despite COVID-19,” Vita Group chief executive Maxine Horne said.
"ICT revenues increased two per cent to $752.0 million and EBITDA, excluding the impact of AASB 16, was $84.9 million, up seven per cent on the prior year. The retail ICT division delivered a five per cent increase in revenues due to a continued focus on consulting and delivering products and services which create value for customers. Device revenue was strong, particularly from the start of the period up to March 2020 and the impact of COVID-19. The retail team leveraged its capacity and capability during COVID-19 to support Telstra to keep customers connected to mobile and fixed networks, which is critical during lockdown periods."
"The business ICT division continued to complement the retail ICT store network by providing solutions to small-to-medium and large business customers. The Telstra Business Technology Centres and the enterprise business achieved significant productivity improvements, whilst supporting steady demand during COVID-19 as business customers enabled their employees to work remotely."
“We are about to embark on a new chapter. We have significant capability in running a national, dispersed network and delivering a premium experience, resulting in value for all. The Vita team are disciplined, focused and passionate about looking after our customers and I thank them for their hard work (historical and future) and willingness to adapt and evolve.”
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