|Cellnet's annual revenues could shrink by AUD$148 million from October following the termination of its distribution and logistics agreement with Telecom New Zealand.
According to a statement posted by the ASX-listed distributor, Telecom NZ has extended its contract with Cellnet until September 30, at which time the two will part company. The deal is part of a transitional arrangement until the telco's WCDMA/GSM network rolls out in November.
The decision is expected to decrease Cellnet's revenues by AUD$148 million from October, or about AUD$1.25m in annual net profit.
"Cellnet is continuing to discuss and finalise these transitional arrangements and options available beyond this transitional phase," the statement read. "These discussions and arrangements are expected to be finalised within the next few weeks and as matters are completed further information will be released."
Cellnet and Telecom New Zealand signed an exclusive distribution contract covering mobile phones and accessories in April 2002 after working together since 1994. At the time, managing director, Stephen Harrison, said Telecom New Zealand was the distributor's single largest customer and that the deal would substantially increase its presence in the New Zealand market.
Cellnet reported revenues of $528.2 million in its full-year report to June 30 last year.