JOHANNESBURG – Pressure is mounting on Blue Label Telecoms to release its annual financial statements and its notice of annual general meeting or face suspension of trading.
The JSE announced on Tuesday that it would move to suspend the group’s listing for the second time since last month in the interest of shareholders.
Blue Label, whose loss-making subsidiary Cell C has lost market share amid a competitive environment, closed at R2.94 on the JSE on Tuesday after gaining 1.73 percent.
The JSE said Blue Label had failed to distribute its annual financial statements and notice of annual general meeting within the four-month period stipulated in the JSE’s listing requirements. It said that the company’s listing had been annotated with an “RE” to indicate that it has failed to comply and that the listing of its securities was under threat of suspension and possible removal.
“If the abovementioned company still fails to distribute its annual report on or before October 31, 2019, then its listing may be suspended,” it said.
The JSE announcement came a day after the telecoms group advised shareholders that the integrated annual report and notice of annual general meeting would be made available on October 29, 2019.
“The JSE’s notice today is simply their process that needs to be followed whenever there is a delay in the release of results,” Blue Label’s head of investor and media relations Nicola White said yesterday.
Blue Label previously delayed the release of the results for the year ended May to the end of last month to take into account the impact of Cell C’s recapitalisation and restructuring. Blue Label owns 45 percent of Cell C after buying into the company in 2017.
The financial results were due for release on August 27, and were released on September 26. Blue Label reported a loss of R6.65 billion for the 12 months to May 31, compared with a profit of R1.12bn a year earlier. It posted a headline loss per share of 312.49 cents and a core headline loss of 304.77c.
It attributed the performance to Cell C’s trading losses, impairment of its property, plant and equipment and the impact of a derecognition of its deferred tax asset and the impairment of Blue Label’s total investment in it. However, management said the new national roaming agreement would result in substantial cost savings for Cell C by reducing network and capital expenditure.
“These savings will further be enhanced on completion of an intended extensive capital restructure objective,” the company said last month.
In August Cell C finalised a term sheet detailing a further national roaming agreement with MTN.
Last November, MTN and Cell C concluded the implementation of a national roaming agreement which saw MTN providing 3G and 4G/LTE services to Cell C in areas where the mobile network operator had chosen to purchase coverage rather than self-built.
This meant that Cell C customers outside the urban centres currently roam on MTN’s 3G and 4G/LTE networks.