/ 6 June 2005

Results send Telkom on all-time high

Shares in telecommunications group Telkom rose to a lifetime high of R119 per share on Monday after the firm announced its financial results for the year ended March 2005.

Telkom reported a 53% rise in basic earnings per share to 1241,8 cents, from last year’s 812 cents.

The results came in slightly above market consensus. The market had forecast an improvement of between 40% and 50%.

The Johannesburg- and New York-listed firm also said it will pay out an ordinary dividend of four rand per share and a special dividend of five rand per share.

Telkom has more than 50 000 black investors shareholders, who bought their shares at R22,40 under the Khulisa scheme. The state is the group’s largest shareholder, with a 38% stake, while the Public Investments Corporation’s stake has decreased to 5% after it sold a 10,1% stake to empowerment groups Elephant and Buffalo consortia.

At 12.46am, Telkom shares were trading at R118 — up one rand from Friday’s close.

More than 560 000 shares, worth R66,415-million, had changed hands in 361 deals.

Since listing on March 4 2003, Telkom’s share price has roared ahead more than 320%.

A Cape Town-based analyst said it is not surprising that the group will be paying out more than R5-billion in dividends, given Telkom’s huge cash pile. After this payout, he said, the firm is likely to disburse a further R4-billion by way of share buybacks, dividends or further investments.

Telkom CEO Sizwe Nxasana said, during the results presentation, that the firm is looking at investing in the Democratic Republic of Congo, where its 50%-held subsidiary Vodacom group already has mobile operations.

Kenya and Nigeria are also markets Telkom has identified for future expansion, he said. — I-Net Bridge