SA Telkom earnings rocket

JOHANNESBURG – Africa’s biggest phone company Telkom posted annual earnings above forecasts yesterday and said its focus would shift to new markets at home and in sub-Saharan Africa in fixed-line and mobile businesses.

The news pushed its shares up five per cent to 81,75 rand, making it the bourse’s biggest net gainer in early morning trade. Telkom, which owns half of the continent’s biggest mobile phone operator, Vodacom, put a brave face on its surprise retreat from Nigeria, potentially Africa’s most lucrative cellular market, and said there were plenty of opportunities elsewhere.Vodacom pulled out of a five-year contract to run Nigeria’s second biggest cellphone operator Econet Wireless Nigeria (EWN) last week, citing concerns over corporate governance and lack of proper control of the company.”No country is going to replace Nigeria certainly in terms of growth numbers offered by population size, but we still believe there are other investment opportunities in Africa,” Telkom CEO Sizwe Nxasana said.Telkom said headline earnings per share rose to 863,6 cents for the year to the end of March, 2004, a 175 per cent leap from 314 cents the year before.Five analysts surveyed by Reuters had expected Telkom to deliver 724 cents in headline earnings per share.Headline earnings strip out capital, non-trading and extraordinary items.”The focus will increasingly shift outward to seek new growth opportunities in selected new market areas, such as data, and exploiting synergies between fixed-line and mobile,” South Africa-based Telkom said in a statement.”Additionally, both businesses will seek to pursue considered African expansion.”Nxasana said those new markets outside South Africa, particularly for mobile, would be in sub-Saharan Africa.But analysts said they were hard-pressed to see greenfield growth opportunities on the continent and certainly nothing in the order of Nigeria, which is the fastest growing mobile phone market in Africa.Telkom’s group operating revenue rose 8,8 per cent to 40,795 billion rand, driven mainly by a 23,2 per cent increase in mobile revenue.Vodacom, 35 per cent owned by Britain’s Vodafone, lifted customers in South Africa to 9.7 million and by 93 per cent in other African countries to 1,49 million, bringing the total number of subscribers to 11,217 million.The firm’s average revenues per user (ARPU) declined 3,3 per cent to 177 rand.-Nampa-ReutersTelkom, which owns half of the continent’s biggest mobile phone operator, Vodacom, put a brave face on its surprise retreat from Nigeria, potentially Africa’s most lucrative cellular market, and said there were plenty of opportunities elsewhere.Vodacom pulled out of a five-year contract to run Nigeria’s second biggest cellphone operator Econet Wireless Nigeria (EWN) last week, citing concerns over corporate governance and lack of proper control of the company.”No country is going to replace Nigeria certainly in terms of growth numbers offered by population size, but we still believe there are other investment opportunities in Africa,” Telkom CEO Sizwe Nxasana said.Telkom said headline earnings per share rose to 863,6 cents for the year to the end of March, 2004, a 175 per cent leap from 314 cents the year before.Five analysts surveyed by Reuters had expected Telkom to deliver 724 cents in headline earnings per share.Headline earnings strip out capital, non-trading and extraordinary items.”The focus will increasingly shift outward to seek new growth opportunities in selected new market areas, such as data, and exploiting synergies between fixed-line and mobile,” South Africa-based Telkom said in a statement.”Additionally, both businesses will seek to pursue considered African expansion.”Nxasana said those new markets outside South Africa, particularly for mobile, would be in sub-Saharan Africa.But analysts said they were hard-pressed to see greenfield growth opportunities on the continent and certainly nothing in the order of Nigeria, which is the fastest growing mobile phone market in Africa.Telkom’s group operating revenue rose 8,8 per cent to 40,795 billion rand, driven mainly by a 23,2 per cent increase in mobile revenue.Vodacom, 35 per cent owned by Britain’s Vodafone, lifted customers in South Africa to 9.7 million and by 93 per cent in other African countries to 1,49 million, bringing the total number of subscribers to 11,217 million.The firm’s average revenues per user (ARPU) declined 3,3 per cent to 177 rand.-Nampa-Reuters