Telstra has frozen its job-cutting program for six months, suspended late-payment fees and disconnections, and will hire 1000 temporary contractors to help counter the economic toll of the COVID-19 outbreak.
On Friday, the telco giant also said it would bring forward $500 million capital expenditure from the next financial year to increase its network capacity during the coronavirus pandemic and help it accelerate the rollout of its 5G network.
Chief executive Andy Penn said the virus would likely have an impact on the company’s future balance sheet, but said it was important for big business to “show leadership and contribute to the national response”.
“Like many businesses it is expected to be material and will depend on how the situation and its impact on the economy and our customers evolves,” Mr Penn said.
“While it is critical we maintain a strong position, we also believe there are a range of additional initiatives we can undertake now to help support the broader economy.”
Telstra said small businesses and consumers unable to pay their bills would not be charged late fees or disconnected until at least the end of April. The policy would be reviewed then.
These measures are in addition to unlimited data allowances on fixed broadband and extra mobile data for Telstra’s consumer and small business customers, as well as extra paid leave for Telstra employees and casuals.
The 1000 temporary staff hires will help the company handle a spike in call centre volumes.
Telstra committed to continuing its productivity program to reduce underlying fixed costs by $2.5 billion annually by the end of FY22 but will not cut jobs for the next six months.
At its first-half results last month, Telstra said it had completed 6900 of the 8000 net job cuts it flagged in June 2018.
Telstra’s current outlook remains within the range of its FY20 guidance, which it changed in September to reflect the costs of the National Broadband Network rollout.
The FY20 outlook is outlook is, however, at the bottom end of the range for free cash flow and underlying earnings, and the bottom end of the $0-$500 million range for growth in underlying earnings, excluding the in-year NBN headwind.