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Home » News » Business » BTCL profit up 12%

BTCL profit up 12%

Publishing Date : 05 December, 2017

Author : AUBREY LUTE

Botswana Telecommunications Corporation Limited’s profit after tax for the six months ended 30 September 2017 increased by 12% with revenues also picking up slightly by 2%. The strong set of results show that liquidity remains strong with zero gearing.


The only listed telecommunication company in the Botswana Stock Exchange (BSE) reported 11% reduction in cost of sales leading to an increase in gross profit of 11%.  Mobile was the highest contributor with 37%; closely followed by data with 34%; and fixed, which is steadily declining contributed 28% to sales.


Highlighting the challenges facing the company, BTCL Managing Director, Anthony Masunga, said the revenues continue to be pressured by efforts of regulators (and governments) to continuously push down prices, as a way of driving universal access to telecommunication services. Furthermore he revealed that mature markets like Botswana face limited growth prospects, and entry of previously unrelated businesses into the Telco ecosystem, resulting in intensified competition. The company’s profit comes about after the company managed to contain costs and increase sales.


The company also managed to improve on its cashflow. The cash generated from operating activities was P487million, a significant improvement from the last set of results.  For the period under review the company made investments into new systems, infrastructure modernisation and expansion of P124million.


The leading telecommunications provider is bullish about the future despite the intensifying competition in the telecommunications sector. While acknowledging that various players are entering the market at different levels of the telco value chain on the back of the new licencing framework, the new developments also present partnership opportunities, revealed Masunga. He pointed out that the intense competition has also put pressure on the mobile market which is experiencing high churn rates and margin squeeze.


“Despite the subdued economic growth which has put pressure on bucket spend, BTC will continue to explore growth opportunities, especially in the broadband space, where penetration levels are still low and the demand for data services is on the increase. We expect positive results from our 4G service, which we introduced in our urban and peri urban areas around the country,” observed Masunga.


The BTC MD noted that one of the biggest challenges which is proving to be a challenge to their subscriber base growth is number portability. ‘People do not want to lose their numbers, they may be interested in using your services but they want to retain their numbers. We have already touched base with the regulator on the matter and they said it is a matter they could only look into in the next financial year.” BTC also hopes to transform its journey with a focus on network, commercial and cultural transformation.


BTCL is not far off its projected profits of P115 million in the 2017 financial year. The company says it will turn to improving its revenue streams through increased sales while at the same time containing costs. Moreover, revenue is expected to stabilise following huge price cuts and it will be boosted by the company’s focus on mobile and broadband (fixed and mobile) data services as avenues for continued growth in the short-to-long term. Botswana with the highest number of mobile penetrations in the world has provided a lucrative market for data services.


BTCL listing on the Botswana Stock Exchange (BSE) in April was preceded by a nationwide awareness campaign and ended with a record breaking number of domestic investors. BTCL which listed 1.05 billion issued securities ushered in more than 50000 citizen investors, prior to that there were only 28122 registered Central Securities Depository Accounts (CSD).The Company is a provider of communications solutions and services. BTCL’s principal activities include among others: fixed and mobile voice telephony, national and international internet, data services, directory services, virtual and private networks.


BTCL declared an interim dividend of 3.73 thebe per share, payable to all shareholders registered in the books of the company at close of business on 29th December 2017. The dividends are payable on or before February 9th next year. The company, which has a market capitalisation of P1.82 billion is currently have an impressive run on the stock market. The company is currently trading at P1.69 per share an incredible surge from the initial offering of P1 per share.

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