EMELIA SITHOLE, Johannesburg | Thursday 12.00pm.
TELECOMS company M-Cell has reported a sharp rise in headline earnings for the year ended March 31, 2000 and says it is confident of strong growth in the current year.
It also says it is braced for the issue of a third mobile phone licence and that it is well-positioned to withstand and benefit from the envisaged competition.
M-Cell Chairman Irene Charnley sees scope for revenue growth coming from an expansion of its mobile cellular phone operator MTN’s prepaid and contract subscriber base, its Africa operations as well as its data-mobile E-business.
”The earnings per share I think would be strong or acceptable comparable to what you have with other mobile operator groups,” Charnley said after unveiling M-Cell’s annual results on Wednesday.
M-Cell doubled its headline earnings per share for the year under review to 50,7 cents, beating analysts’ consensus forecast of 43 cents.
It declared a final dividend of 5,6 cents versus 4 cents with finance director Jacob Modise saying the M-Cell board has adopted a conservative dividend policy so that the bulk of the cash could be retained to fund continued growth.
M-Cell shares ended the day 1,10% lower at R36,10, in line with a weaker telecoms sector which underperformed the Johannesburg bourse’s benchmark All Share index which closed 0,67% up at 7703,8.
”The challenge is the third operator who is coming onto the market and if it stimulates the market and competition we might do better than what we have projected. We are well prepared for competition,” she said.
South Africa’s market is currently dominated by MTN — which is 77% owned by M-Cell — and Vodacom, who were awarded licences by the government when the sector was opened up in 1994.
The market has been waiting for over a year for the issuing of a third licence but the process has been held up by accusations of corruption at the telecoms regulator, legal wranglings over bidding partnerships and changes at the top of the telecoms ministry. — Reuters