CAPE TOWN - CAPE TOWN - Telecommunications provider Telkom has released its financial results for the year ended 31 March 2018.
Here are 10 things you need to know:
1. Telkom reported a 6.55% drop in operating profit for the year ended March 2018, to R4.939 billion
2. Revenue flat at R41.018 billion.
3. The group reported a 19.2% decrease in profit after tax to R3.158 billion.
4. Group EBITDA down 3.6% to R10.544 billion with an EBITDA margin of 25.7%;
5. This resulted in an 18.4% decrease in headline earnings per share (HEPS) to 597 cents.
6. Mobile service revenue up 47.2% to R5.2 billion;
7. Free cash flow up 465.7% to R501 million;
8. Capex down 8.6% to R7.9 billion;
9. Annual dividend down 16.3% to 355 cents per share.
10. fibre to the home connectivity rate increased to 30.7% (FY2017: 18%)
Chief executive officer, Sipho Maseko said, “The year was characterised by a tough economic environment, political uncertainty and intense competition as well as the consequent low business and consumer confidence.
“We felt the impact of the weak economic environment, as the private and public sectors respectively deferred and lowered their information communications and technology (ICT) spend. This impacted Telkom’s performance, particularly in BCX, which serves the business sectors.”
He said that the growth in the mobile business was underpinned by capital investment, extension of distribution channels, increased store footprint and innovative data-led products which resonated well with customers.
Telkom, in which the government plans to sell part of its 39 percent stake, is also grappling with an economy that is barely growing and intense competition amid political and policy uncertainty and sovereign credit rating downgrades in 2017.
“Our focus going forward is to increase the contribution from the new generation revenue streams (mobile and data),” he said. “Despite their lower margin compared to traditional revenue streams, the new-generation revenue streams will ensure Telkom’s long-term sustainability.”
Telkom declared an annual dividend of 355 cents per share, down 16.3%.