For the year ending March 31, 2004, it posted a net profit of ZAR 4.52bn ($701m), double that of ZAR 1.63bn ($253m) a year ago, while operating profit increased 39.5% to ZAR 9.08bn ($1.40bn).
The group’s revenue was up 8.8% at ZAR 40.795bn ($6.32bn) from ZAR 37.507bn ($5.81bn). The Pretoria-based telco credited the increase to cost-cutting measures in its fixed-line business, and the streamlining of operations across the group.
It also cited the ongoing growth of its mobile phone interest. Telkom has 50% stake in Africa’s largest mobile operator, Vodacom (Pty) Ltd, which also reported its year-end results yesterday.
The stake in Vodacom was a significant contributor to the bottom line, with the mobile operator increasing its South African customer base to around 10 million and doubling subscribers in the rest of Africa to 1.5 million in the past year.
In March last year Telkom listed in the stock exchanges in Johannesburg and New York, a move which netted it roughly $486m. The South African government made the decision to sell off 25% of its 70% holding, to help pay off foreign debt and finance a budget deficit.
The remaining 30% of the telco is still held by SBC Communications Inc and Telekom Malaysia Bhd, part of a consortium called Thintana Communications.
There has been speculation that SBC and Telekom Malaysia could begin to reduce their holdings over the next year, although there have been no formal announcements.
Analysts said the results were much better than expected, but were aided by some special factors, such as a delay in awarding a second fixed-line telephone license in South Africa.
The South African government is expected to license a second operator before the end of this year, but it will take time to make an impact on Telkom’s domination.
