Telkom Earnings Cut More Than Half

Telkom today reported less than half the earnings it had in the same quarter a year ago and announced the resignation of its chairman Sello Moloko.

The company said headline earnings per share – South Africa’s main profit gauge – dropped by 51.9% to 137.2 cents a share for the six months to end-September 2022.

Telkom also reported that group revenue down 0.7% to R 21.2 billion and EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) down 17.3% to R4.9 billion.

The decline in EBIDTA of 17.3%, partially offset by lower finance charges and fair-value movements, resulted in a decline in HEPS & BEPS of 51.9% and 52.5% respectively.

Its wholesale infrastructure connectivity provider Openserve’s total revenue declined by 4.3%.  On the other hand, BCX, the country’s leading information and communications technology (ICT) solutions provider, reported a flat 0.8% growth,

Swiftnet, the masts and towers business, recorded a 2.1% decrease in revenue to R660 million, driven by the impact of continued focus on modernisation from mobile network operator (MNO) customers.

Within the Telkom Consumer Division, mobile customers are up 10.9% to 18 million subscribers, with 61.1% of customers using broadband services. Despite a 14.1% increase in mobile data traffic, mobile revenue from external customers remained flat at 2.3%. This was driven by changes in the product mix to ensure Telkom retains and grows mobile subscribers, while also retaining its value positioning of providing affordable services.

“The Group’s leadership team is laser-focused on delivering on our strategy to deliver shareholder value by ensuring long-term, sustainable growth,” said Telkom Group CEO, Serame Taukobong.

“Management is continuing to explore various options of realising the value of the mast and towers business and will update the market in due course.

“The plan to stabilise Openserve continues positively, with 65% of revenue now coming from next-generation products and services,” says Taukobong. “The growth in high-capacity links for carriers, an increase in demand for fibre services and growth in enterprise connectivity is also pleasing.”