• Tue. Jul 16th, 2024

Econet back in black, posts $63.65bn profit in 1H23


Nov 24, 2023

By ETimes

Econet Wireless Zimbabwe has moved from a loss-making position to post $63.65 billion for the half year ended 31 August 2023.

The telecom giant has focused on improving its operational efficiency, expanding its service offerings and exploring new revenue streams. These efforts have paid off handsomely, resulting in a substantial increase in revenue and ultimately leading to profitability.

Accordingly, the company’s inflation adjusted revenue rose 186% to $1.09 trillion from $384 billion in the comparative period.

“Growth in revenue resulted from a volume growth of 24% and 25% for voice and data respectively,” Econet chairman James Myers said in a statement accompanying the results.

“However, the group incurred a loss before monetary adjustment of $24 billion against a prior period comparative loss of $40 billion resulting from inflationary pressures in the economy that affected profitability.”

The telecom giant continues to battle foreign exchange losses owing to weaknesses in the local currency.

“Exchange losses from US dollar denominated liabilities driven by the weakening local currency continue to have a negative impact on the group’s performance,” Myers said.

“During the period, the Group incurred exchange losses amounting to $375 billion representing 34% of revenue against a prior period comparative of 39%.”

The company has consistently demonstrated its ability to adapt to changing market conditions and seize new opportunities.

Myers said the company managed to update its network despite years of underfunding by effectively utilising our relationships with main equipment providers.

“From an investment level of less than 5% of revenue in previous years, capital investments for the period rose to 24% of revenue, in the period under review. As a result, we modernised 252 base station sites in the first quarter, and 439 base station sites in the second quarter, covering Harare and Bulawayo.

“The network modernization entails replacing old equipment that had limited capacity or is no longer supported by the vendors. The modernised equipment has better performance, capacity and coverage,” he said.

Direct network and technology operating costs went up 206.65% to $256.49 billion from $83.64 billion previously.

The telecom giant did not declare a dividend citing the ongoing capital expenditure program.

On the Zimbabwe Stock Exchange, Econet closed Wednesday’s session 0.05% higher at $690.35-HARARE

By ETimes

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