John Linton .......I haven't seen any hint of the 'D' word in the world's financial press....mind you, there could well be a very scary reason for that.
I received another "just to let you know I'm leaving 'supplier x'" yesterday which is some sort of sign. I think it mainly means that carriers/providers are finding life tougher than in the past and, in the case of some of them, they are "down sizing" their wholesale sales people....US companies are usually the first to adopt this practice and therefore it is a usually bell whether indicator early sign that they at least do not see a rosy future in the coming period. With the DOW falling over 600 points overnight and the Australian market almost certainly following suit today there is no relief from bad news anywhere you look. Another early sign:
http://www.smh.com.au/business/job-market-shows-signs-of-softness-20110808-1iidr.html
which just confirms why I am receiving an increasing number of unsolicited resumes for a wide range of positions - including at least one or more from many of our supplier personnel....it doesn't seem to be a good time to be in sales in this industry at the moment....or perhaps in any industry:
http://www.businessspectator.com.au/bs.nsf/Article/SP500-ASX-Obama-tax-reform-social-democracy-pd20110809-KJTFN?OpenDocument&src=kgb
So despite the rote nonsense from Whine and Ms Faustus (I couldn't believe that dumb woman's cynical speech writers bowdlerised the Gandhi quote on the front of our web site in such a shitty way yesterday) assuring the stupid that "everything's fine" - it isn't - and in NSW it has been far from fine for almost two years and steadily getting worse. Perhaps the current apology for a government will notice one day? Not that it matters there is now no tax payer money left to do anything about it courtesy of the moon faced fool's spending last time. When we were doing the planning for FY2012 we took in to consideration that the economy was going into recession (living in NSW with an IQ above your the number of days in the month didn't require much to reach that obvious conclusion) and thought it would be a net plus for Exetel rather than a negative so we didn't let it affect the numbers we came up with).
It is not sensible to take our results over the first 5 weeks (and the least definitive weeks of any financial year) of the new financial year as any guide to the year's future but it is better, as in our case, to have started the year 'on target' than the reverse. Things change very quickly in market places generally (not just financial market places) for anything other than a 'so far so good' attitude to be taken to YTD results so early in any planning period. All the signs are that Australia will not have as good a year as last year and that the predicted tax revenues in the current government's budget for this year and the estimates for the following years will turn out to be yet another Labor financial irresponsibility myth. No problem - it is a familiar pattern. The stock market gyrations are largely irrelevant to 'the public' with the only real effect on making it harder for those companies negatively effected (currently all of them) to borrow money for expansion and where they can borrow making it more expensive to do so.
In terms of how this may affect residential communications users in Australia is not possible for me to say. If I was to say anything I would suggest that Australian users will see even longer telephone support wait times (60 or so minutes will become even more common) and email reply times that will often be no replies at all (based on hiring freezes for support centre personnel or, perhaps, more drastic measures). I wouldn't expect to see prices fall except for sporadic 'promotions' by the two major carriers and their wholesalers from time to time. While the likes of iinet and TPG are predicted to report good profits for FY2011 those profits will be based on more than the usual 'fine tuning' and it seems very unlikely that they will reduce prices over the coming year. So in consumer land it will not be as 'good' a year as last year as far as I can see.
So, for Exetel it is still a one day at a time management process though, and I probably shouldn't keep saying this, it doesn't appear to be as hard as this time last year.
Copyright © Exetel Pty Ltd 2011
ABN 350 979 865 46