Telkom Mobile unlikely to break even this quarter

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Telkom Mobile, a business unit of information and communication solutions provider Telkom, posted a 22% rise in customers to 2.6 million total subscribers in the three months to end-December 2015 and is unlikely to break even by March 2016. By Gugu Lourie


The Centurion-based firm said on Monday Telkom Mobile increased subscribers by 22% to 2.56 million, with blended average revenue per user of R90.26.

The telco added that its contract customers spiked 45% while prepaid users grew  by 15%.

The mobile unit also grew its service revenue by  37% and data revenue was up 56% year-on-year.

“Our initial expectation that the mobile business would break even by March 2016, has been tempered  by the operating environment and cost pressures. We are however confident that we will maintain the current positive revenue growth witnessed in this part of the business,” Telkom said in a statement on Monday.

Last year, Telkom pulled out in talks to buy bigger mobile rival Cell C.

Telkom said talks to buy Cell C collapsed after not reaching an agreement with Oger Telecom on how to value Cell C.

By “mutual agreement” Telkom and Oger Telecoms ended all discussions related to the potential purchase of Cell C by Telkom.

“Through Telkom’s engagement with Oger Telecoms in relation to Cell C, it has become clear that there is a difference between the parties on the assessment of value of the proposed transaction. As no agreement has been reached, Telkom and Oger Telecoms today agreed to end all discussions,” said Telkom in a statement last year.

 

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