South Africa’s biggest landline provider, Telkom, has entered a new phase of growth by giving more autonomy to its four business units to boost earnings, resulting in an increase in its full year earnings and dividend.
In a statement released by the company, earnings per share increased by 12%, operating revenue gained 9.8% and the annual payout to shareholders increased by 56%.
Sipho Maseko, Chief Executive Officer, Telkom, said, “We made significant strides in a difficult operating environment which was characterised by regulatory uncertainty, increased competition and a weak economic environment
“Splitting the reporting of the business units will provide shareholders with more clarity on which company is contributing what to earnings
“We have provided more clarity on our dividend in that we will pay shareholders 60% of headline earning”, he said
At the time of publishing, Telkom shares increased by 2.3%, and have soared more than 400%, valuing the company at R40bn.
Capital expenditure increased by 43% as the company invested in fibre networks and the wireless business. Mobile subscriber numbers rose by 48% to about 4 million.
The phone operator started a mobile unit, the country’s fourth biggest, to offset a decline in landline use and challenge market leaders Vodacom Group and MTN Group.