This is James Hall speaking from the TPG Telecom Investor Relations team. Welcome to the presentation of our results for the half year ended 30 June 2022. This is a pre-recorded presentation available prior to a live Q&A session at 10:30 A.M. TPG Telecom acknowledges the traditional custodians of country throughout Australia and the lands on which we and our communities live, work, and connect. We pay our respects to their elders past, present, and emerging. Our CEO, Iñaki Berroeta, will begin today's presentation with the result, highlights, and business update. Our CFO, Grant Dempsey, will then present our financial performance in more detail before Iñaki closes off the presentation with a summary of our strategy and outlook.
Thank you, James, and good day to all of you listening to our presentation. Our first half results reflect strong progress on delivery of our strategy. We have emerged from an intense period of business integration, transformation, and market uncertainty. Now with good momentum, building towards a new phase of growth, which is accelerating into the second half. We recorded a strong mobile customer growth in the half, adding 135,000 subscribers and returning to ARPU growth. In home broadband, we are driving profitability by managing NBN margins as we grow our own net customer base, primarily through our fixed wireless proposition. In enterprise and government, we continue to deliver important customer wins with large business customers on the back of our ability to deploy a mix of on-net fiber and NBN connectivity. We are focused on mobile convergence and building our managed service capability.
In wholesale, we are progressing our G.fast deployment and looking forward to the opportunities of functional separation in our residential access business later this year. This was also a half of a strong transformation in the business. We started implementing a simplified organizational structure, signed a transformational regional network sharing agreement to bring a stronger competition to regional Australia, accelerate our five-year rollout and complete the sale of our tower assets to OMERS. EBITDA for the half year was AUD 837 million, although this includes restructuring costs of AUD 35 million. The board has declared a fully franked interim dividend of AUD 0.09 per share, up 12.5% on the 2021 interim dividend.
Looking to the full year, we remain on track to deliver annualized synergies from the VHA TPG merger, in line with our target of AUD 125 million-AUD 150 million this year, one year earlier than originally planned back in 2020. There is accelerating momentum with earnings to be weighted to the second half as we build on a strong second quarter and benefit from the full run rate of our growing mobile subscriber base. Now, looking at our performance in more detail and starting with mobile, as we highlight in the Investor Day, we have several levers to drive service revenue growth in consumer mobile and significant opportunity in enterprise mobile. The power of the Vodafone 5G global network and our cross-selling efforts are connecting with customers, and we are reducing churn across our brands.
The strong subscriber growth in the hub reflects especially a strong growth in prepaid following the return of international travel, as well as growth in our postpaid base. International arrivals in July this year were 54% of the July 2019 pre-COVID level, and our Vodafone and Lebara brands are performing especially well in this segment. International roaming has also supported ARPU recovery in postpaid, which increased 2.2% to AUD 42 compared with the first half of 2021. Roaming was around 55% of pre-COVID levels for the half, but was closer to the 70% of pre-COVID levels in June, which goes well for the second half of the financial year. In fixed, our focus is on improving profitability through Fixed Wireless growth and NBN margin management.
We began communicating this week some modest increases to the prices of our lower speed NBN plans across parts of our customer base. It is important to point out these price increases do not apply to our fastest NBN plans, our super fast on NBN fixed broadband products, or our Fixed Wireless plans. We have done this because the amounts we pay to NBN for the use of its network have increased significantly as a consequence of Australians relying more on their home broadband when they work and study from home. These factors have benefited NBN but continue to put margin pressure on the retail service providers that are supporting the connectivity needs of many Australians.
For our Fixed Wireless business, we reported a 33,000 increase in subscribers in the period to 113,000 and remain confident of achieving our 160,000 subscribers target in December as we tackle supply chain constraints pertaining to modem availability and chipset shortages. Importantly, our own network products are delivering a margin benefit over NBN products consistent with our expectations, which along with our pricing actions, will support improved fixed margins over time. Looking further ahead, we continue to consider the use of millimeter wave spectrum across the major capitals to support further Fixed Wireless growth post-2025. Now turning to our proposed network sharing agreement with Telstra in regional Australia announced in February, which remains subject to ACCC approval. Network sharing is a smart and efficient way to enter the regional market.
Not only does it increase service choice for customers in the cities and the regions, it avoids duplicating infrastructure, the cost of which would ultimately have to be paid for by consumers. Regardless, we are ready to deliver a step change in regional competition, and it's clear that is what customers want. The ACCC public consultation process concluded in July, attracting overwhelmingly supportive submissions from community groups and customers. We have been undertaking technical testing and expect to be ready to turn on the shared regional network shortly after the ACCC makes its decision. This plan will establish a new era of increased choice and competition for Australian consumers and businesses. It will strengthen our proposition, not just in the regions, but for all Australians, increasing our addressable market by 60%. The outlook is also exciting for our wholesale business.
In April, the ACCC accepted TPG's joint functional separation undertaking, which will come into effect on the seventh of October of this year. This undertaking will apply to all local access lines we control to the extent they are used to supply superfast carriage services wholly or principally to residential customers. This includes our existing FTTB networks in metro locations, the TransACT VDSL network in the ACT, our HFC networks in Ballarat, Mildura and Geelong, as well as any new superfast local access lines we deploy. Functional separation enables us to offer access to these networks under one structure to other retail service providers. This presents a significant opportunity to grow from our current base of 135,000 subscribers on these networks into the 400,000 premises we pass while creating a platform for additional growth.
As the chart on the right of the slide shows, demand for data traffic is expected to far outstrip growth in total broadband subscribers in coming years, and that means more customers will be looking for higher speeds at predictable prices. We can offer up to gigabit per second speeds on FTTB enabled by G.fast technology deployment under a simpler pricing structure than NBN. As part of the evolution of this business, we will be reporting the wholesale component of the circa AUD 110 million of annualized revenue we generate from these networks in the enterprise, government, and wholesale segment from our fiscal year 2023 results rather than in consumer. Our sustainability strategy continues to evolve and develop following its launch last October. We are making good progress on achieving recognition across the four categories of consumer well-being, environmental responsibility, inclusion and belonging, and digital economy.
Environmental responsibility is a key focus given the urgent need for action on climate change. Tendering is underway to support our commitment to power our Australian operations with 100% renewable electricity by 2025. We are currently completing detailed mapping of our carbon emissions, including Scope 3 emissions, and on track to submit our reduction targets to the Science Based Targets initiative by the end of the year. We are also planning to publish the TCFD report with our 2022 annual results, and we are exploring options to introduce sustainability elements to debt financing. I will now talk about the outlook before handing to Grant. TPG Telecom is entering a new phase of growth following a complex period of intense business integration and disruption from the pandemic, with accelerating earnings momentum into the second half of the year.
As the chart on the left shows, we have turned a corner in terms of service revenue, returning to growth in the second quarter. Seven weeks into the third quarter, we are very confident of delivering an increased rate of service revenue growth. EBITDA is also returning to growth. Excluding the impact of restructuring costs, first half 2022 EBITDA exceeded the second half of 2021, and we are well positioned for a strong increase in second half earnings. We will have the full run rate benefit of our higher mobile subscriber base, with fixed margins supported by Fixed Wireless growth and discipline in NBN plan pricing and roaming revenue recovery by increasing international travel. We also remain on track to realize the full AUD 125 million-AUD 150 million of synergies from the VHA TPG merger.
We anticipate total restructuring costs for the year will be between AUD 55 million and AUD 60 million, including the AUD 35 million incurred in the first half. I will now hand to Grant to discuss our financial performance in more detail.
Thank you, Iñaki, and good morning all. I will start with a summary of our financial performance. Overall, the first half was somewhat of an inflection point, with momentum building for growth in the second half. After a sustained period of negative headwinds, service revenue was modestly up year-over-year at AUD 2.19 billion. However, it was only in the last few months that the strong subscriber momentum we've been generating since late 2021 started to translate to earnings growth. That momentum is continuing to build into the second half. Gross margin was down slightly at AUD 1.38 billion, reflecting the impact of higher NBN costs and reduced margin on handset sales. Operating costs continued to trend down to AUD 508 million for the first half when you exclude the AUD 35 million of restructuring costs.
This reflects the streamlining of our organizational structure early in the half as we transition from synergy realization to the next phase of simplification and transformation focused on unlocking our growth potential. EBITDA of AUD 872 million dollars, excluding the restructuring costs, was marginally down on the first half of 2021, but our current momentum points to strong earnings growth in the second half. Statutory NPAT was bolstered by recognition of AUD 110 million dollars of capital tax losses to be utilized against the tower asset sales, as well as lower financing costs. The restructuring costs and increase in CapEx, in line with accelerated 5G rollout we have already flagged, translated to a AUD 100 million dollar reduction in our operating free cash flow metrics.
Adjusted net PAT was almost 4% higher, which along with our earnings momentum and strengthened balance sheet, supported a very strong 12.5% increase in first half dividend per share. Let's now look at consumer gross margin a little more closely. Service margin was largely unchanged, but underneath that was the pivot from negative year-on-year comparisons coming into the year to positive corresponding growth as we finish the second quarter, driven largely by subscriber growth momentum, which turned positive late last year. Service revenue and margin improvements both tend to lag customer metrics by a few months. We entered the year with subscriber numbers behind the start of the first half of 2021, but finished the half ahead of where we were in June last year. With this positive momentum continuing into the second half.
We did have a modest negative ARPU impact in prepaid from a change in customer mix, with a particularly strong performance from the more budget-focused international brand, Lebara. In our fixed business, we continue to drive home the strategic focus of improving margin. This half, for the first time, we saw more NBN customers migrate to higher margin fixed wireless and costumers moving to the NBN from legacy DSL products. With that legacy headwind largely behind us, we will see increased benefits from the growth in our on-net products. On the cost side, the ongoing impact of higher CVC costs unfortunately overshadowed the benefits we obtained from driving down other telco costs. Our tactical NBN price actions implemented this week, alongside continued fixed wireless growth, will look to reverse the decline in margins we've seen since COVID and recover ongoing cost pressures.
Handset, accessory, and hardware margins were down markedly, reflecting both higher handset costs and increased interest costs for handset receivables financing. We continue to review the role of off-balance sheet handsets financing in a capital structure, given the current interest rate environment and our overall lower bank debt post the tower asset sale. In enterprise government and wholesale, the gross margin comparison was largely flat, but with some significant offsetting drivers. Momentum is building with new products and customer growth, but that was largely offset by the roll-off of legacy fixed contracts and higher NBN costs. Going forward, we expect growth momentum to continue, while the negative year-on-year impact of legacy contracts rolling off will reduce over the next 12-18 months. Excluding one-offs restructuring costs, our operating expenditure fell slightly versus the first half of 2021.
This was largely driven by lower employee costs resulting from the simplification of our organizational structure earlier this year. Technology costs were up slightly, primarily as a result of modestly higher electricity prices and higher energy leases arising from increased network upgrade activities. Our electricity hedging profile continues to protect us in the short to medium term from the extremes of spot price movements. Restructuring costs reflected both redundancies from the organizational simplification and one-off investments we are making in delivering broader transformation over time. This aims to simplify the business dramatically, to create a scalable platform ready to take advantage of the various opportunities we have to grow service revenue over time. We anticipate that we will continue to incur restructuring costs as we execute the simplification strategy over the next couple of years.
We estimate the 2022 full year cost to end up in the AUD 55 million-AUD 60 million range, including the AUD 35 million incurred in the first half. Turning now to our balance sheet, where we continue to focus on optimizing how we fund our assets and our growth. We received the AUD 890 million of proceeds from the tower asset sales on the twenty-ninth of July and have already paid down about AUD 860 million of debt. This includes reducing revolving debt drawn, as well as the permanent reduction in a syndicated term debt of AUD 550 million. The sale also enabled us to fund our long-dated network infrastructure assets more efficiently, with long-term leases creating a natural hedge for future movements in interest rates.
The significant headroom created by the reduction of our debt also gives us increased optionality in relation to our current use of third parties to finance consumer handset receivables. On a 30 June basis pro forma for this paydown, we had net debt of just under AUD 3.5 billion. We have increased our level of interest rates hedging since balance date, noting that about 40% of our total borrowings are already effectively hedged by our long-term leases. Our attention will now turn to terming out the remainder of the 2024 maturity and the appropriate long-term liability structure. We're in a strong position to maintain an investment-grade credit profile while continuing to support significant investments in our assets and growth opportunities, as well as continue to progressively grow our dividends.
A fully franked interim dividend of AUD 0.09 per share reflects the third consecutive half cent increase in the semiannual dividend, and a 12.5% increase on the 2021 interim dividend. The dividend is declared by reference to adjusted net PAT, which adjusts statutory net PAT for amortization of spectrum and acquired intangibles, as well as non-recurring costs and non-cash tax impacts. For the full year, we anticipate to adjust for ongoing restructuring costs and the accounting gain on the tower asset sale. I will close by reiterating the capital allocation framework we set out at the Investor Day, which supports our growth and return on capital aspirations. The first three points are recurring in nature. We will continue to efficiently invest capital to sustain the value of our assets, maintain an investment-grade balance sheet, and look to provide a minimum dividend payout ratio to our shareholders.
The remaining four points are value maximization levers, which are discretionary and compete for capital based on return opportunities. We remain focused on portfolio management, reviewing options to share infrastructure and optimize financing structures, and an ongoing assessment of the ownership structure for core and non-core assets. On CapEx, we expect elevated transformation investment to continue until the middle of the decade, delivering value-enhancing capabilities and platforms. This is mainly focused on accelerating our 5G capability, but we're also leaning int o evolving the IT architecture and other investments required to create a sustainable and simplified platform to support growth. We will prioritize growth CapEx where returns are strong and where we can develop and extend our asset footprints to support customers. The final lever, should the headroom become available, is additional returns to shareholders.
Indeed, all discretionary capital expended is compared on a long-term returns basis to the value of returning capital to our shareholders. I'll now hand back to Iñaki.
Thank you, Grant. To close, let me first recap on our strategy. Back in 2020, we started the journey post the VHA TPG merger with a focus on integration while sustaining operational performance. Today, we have three guiding principles in our strategy. One, integrate and simplify to create a strong, lean, scalable base for our technology, people, processes and brands. A sustainable, simpler platform to grow. Two, win smart. Targeting growth by delivering high-value products and services, leveraging our cost and infrastructure advantage. Three, maximize our potential. We believe TPG Telecom has a unique opportunity to become Australia's best telco for customers, for shareholders, for our people, and for the community at large. The simplicity and value with which TPG has always been synonymous are more relevant today than ever, and our focus positions us to win at a time when the market is becoming more disciplined.
As we look to the remainder of the year, we continue to execute our strategy. We have built a strong TPG Telecom culture, maintained the lowest cost structure in our industry, and demonstrate a disciplined approach to managing our mobile and fiber network smartly and efficiently. We are experiencing a welcome return of momentum in customer growth and transforming our network position to deliver a step change in our ability to compete in all segments, in all technologies, and across the country. Our growth momentum in mobile subscribers will contribute to stronger earnings in the second half, as will the ongoing recovery in international travel. Our Fixed Wireless growth, coupled with our margin discipline on NBN plans, will drive margin recovery in fixed. In Enterprise, we will continue to grow customers while in Wholesale, we have a major growth opportunity in our residential access network business post functional separation.
Having implemented a simpler organizational structure in the first half, we are positioned to deliver the final component of our AUD 125 million-AUD 150 million annualized merger synergy target for the full year, one year early. Most exciting of all, we are transforming our portfolio and our network. Through the proposed regional sharing agreement, we are ready to deliver a step change in coverage and competition in all parts of Australia. Through our 5G rollout, we are strengthening the speeds and quality of our mobile coverage. Through our tower asset sale, we have introduced a more efficient capital structure for passive infrastructure. We are focused proudly on being a great value, simple telco, and look forward to the remainder of the year. Thank you.