Australia's third largest ISP, iiNet Limited (ASX:IIN), has posted strong results for the 2005 financial year with substantial increases in both revenue and profits.

Net profit after tax of $5.6 million for the year ended 30 June 2005, an increase of 41.6% on 2004. Group operating revenue of $158 million was 66% higher than that reported for the previous year. Earnings before interest, taxation, depreciation and amortisation, were $36.5 million, an increase of 63% on the $22.4 million achieved in the previous period.

iiNet Managing Director Michael Malone said, "We’ve experienced consistent and healthy growth over the past three years. The iiNet Group has developed into the third largest provider of Internet services in both Australia and New Zealand. With
this scale and the rollout of our own DSL network we are committed to provide continued innovative, high value services to our customers and continue growing the iiNet business."

As at 30 June, iiNet had 690,000 subscribers of which almost 160,000 were DSL users and a further 71,000 were using iiNet’s telephony service. This week, iiNet launched the first Australian wide-scale VoIP service.

As of 30 June 2005, iiNet had 35,000 customers using its DSL infrastructure with approximately 100 exchanges across Australia enabled with iiNet’s DSL technology. By the first quarter of 2006 iiNet will have increased the number of enabled exchanges to over 200, according to the company, and will have commenced the rollout of its telephony network.

iiNet’s national telephony network will utilise equipment provided by Ericsson. This infrastructure aims to provide customers currently using iiNet’s full telephony service with an equivalent quality of service, and it will reduce iiNet’s cost base enabling it to provide customers with more price competitive offerings. iiNet intends to deploy equipment sufficient to support over 100,000 telephony services in its phase one rollout.

According to iiNet, the integration of OzEmail customers and systems is on track and the company expects an improvement in earnings in 2006, as OzEmail and previously acquired ISPs contribute to earnings for a full year.

IIN shares closed up 2c to finish on $3.24 in a moderate day of trading.