Telstra has raised its total dividend for the first time since 2015, returning $1.9 billion to shareholders following what chief executive Andy Penn says has been the successful transformation of the company.
Telstra's total income dropped 4.7 per cent to $22 billion in the 12 months to June 30, compared to the previous year where it benefited from some asset sales.
Net profit after tax was down 4.6 per cent to $1.8 billion, beating consensus estimates of $1.67 billion.
Underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) was up 8.4 per cent to $7.3 billion and Telstra predicted it would hit $7.8 billion to $8 billion this financial year, on total income of $23 billion to $25 billion
Mr Penn said Telstra set out four years ago with its T22 strategy to "fundamentally transform the company, to simplify and digitise, to set bold aspirations and radical interventions and that is what we have done."
He said while no one could have foreseen COVID-19 and the other seismic economic, political and social changes that have unfolded, Telstra's downsizing through its T22 plan made it simpler, more agile, more efficient and better able to manage through the uncertainty.
Mr Penn, who is retiring next month, added that this past last year was the last one in which Telstra would face headwinds from the NBN rollout.
Moody's Investors Service vice president Ian Chitterer called Telstra's results "credit positive and in line with our expectations, with strong mobile performance being the key growth driver".
Income from Telstra's mobile business rose 1.7 per cent to $9.47 billion, with mobile services revenue up and hardware income down.
Incoming CEO Vicki Brady, Telstra's current chief financial officer, said Telstra expected to sell more handsets this year as more customers come off two- and three-year contracts.
Ms Brady said no decision had been made on InfraCo Fixed, the Telstra division that owns and operates its fixed-line physical infrastructure assets such as fibre, undersea cables and exchanges.
Superannuation companies are said to be keen buyers of the safe assets.
At 10.22am AEST on Thursday, Telstra shares were up 1.1 per cent to $4.055.
Telstra will pay a fully-franked final dividend of 8.5 cents per share, from 8c a year ago. Its total dividend for the year is 16.5c.