Shares in Chorus have fallen 3% after announcing it will cost $300 million more than expected to roll out its part of the ultra-fast broadband network.
The company, which used to be part of Telecom, made $84 million in the six months to December, with an increase in fixed line and broadband connections providing a modest boost to revenue.
Fixed line connections rose by 10,000 nearly 1.8 million, while new broadband connections rose 36,000 to just over a million. Fibre connections grew by half.
But Chorus raised its forecast capital spending plans to between $1.7 - $1.9 billion.
Chief executive Mark Ratcliffe said this was due to the much higher costs of digging up busy urban areas such as Ponsonby and central Wellington to lay the ducts carrying the fibre network, with some costs as high as $8000 per premise.
He said the spending plans should not change again and Chorus will try to find different ways to lay the fibre that will lower costs, including the option of mounting it along telephone poles.
Mr Ratcliffe said the spending plans now should not change and Chorus will try different ways of laying fibre to save costs, including the option of stringing it along telephone poles.
He said that option would only be used where there was existing aerial infrastructure and that could be up to 20% of the total area where the company is the ultra-high-speed broadband builder.
Chorus says it's on track to pass 149,000 premises by the end of June.
The company will pay a dividend of 10 cents a share and flagged a 25.5 cent a share dividend for the 2014 financial year.