Telkom’s mobile business nears ‘break-even’

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Johannesburg - Things are looking up for Telkom’s loss-making mobile phone business as the company on Friday reported stronger revenues.

For the quarter ended June 30, Telkom [JSE:TKG] said that its mobile net revenue was up 68.5% to approximately R350m.

Telkom Mobile still incurred a loss of approximately R30m during the quarter but the company noted that “this is an 87.9% improvement compared to the prior comparative period”.

The company further reported that its active mobile subscriber base has grown 11.7% in the quarter to just over 2.1 million subscribers.

Telkom Mobile’s blended average revenue per user (ARPU) also sits at R82.87 while its post-paid customers base grew by 61.9% and its prepaid base decreased by 1.3%.

During the quarter, Telkom made aggressive plays in the mobile market with tariff cuts and promotions on its LTE offerings.

“Our mobile business continues to grow and we remain confident of achieving break-even during this financial year,” said Telkom in its quarterly update.

In turn, Telkom’s mobile business is even helping to halt the effects of a slowing fixed-line market as its net revenue increased to R6.5bn.

“Net operating revenue has increased 1.7% compared to the comparative period as a result of the strong performance by mobile on data revenue and higher fixed-line subscription revenue," Telkom said.

“This was partly offset by the continuing decline in fixed-line voice usage, due to mobile substitution, and leased line revenues, as a result of customers migrating to newer and cheaper technologies," Telkom added.

Telkom reported that its fixed-line usage revenue had fallen 13.7%, largely as a result of a 5.3% decline in the number of voice lines to 3.394 million.

The telecoms company also said that it experienced at 14.5% decline in leased line and higher capacity connectivity revenue.

Among the bright spots in its fixed-line results, though, was a revenue increase of 9.2% for subscriptions and an increase of 6.3% in ADSL subscribers to 1 014 562.

Following the announcement of the quarterly results, Telkom’s share price was over 6% higher at the close of trade in Johannesburg on Friday as the share surpassed the R61 mark.

Gareth van Zyl, Fin24

Source: http://www.fin24.com/Tech/Companies/Telkoms-mobile-business-nears-break-even-20150731
 
Well their data is cheap so me has a whole bunch of Telkom SIM cards for use
 
Now that mobile data prices have sky rocked up; will shop else where for my mobile data means. Thank you MTN R10 per gig night surfer is a steal

Ja...I only ported to them because of that nice deal they had with R99.00 per month and you get 100 minutes and like 2gig of data etc. Looked at their website the other days and there really was nothing that look appealing.

I am amazed though that they are close to breaking even and Cell C after so many years are still bleeding money.
 
I'll be doing my bit shortly to help them breakeven. I will be porting my contract as well as my missus' prepaid to Telkom shortly. Their contracts and prices make a lot more sense with their recent changes.
 
I wish they would learn some business principles and stop calling it loss-making.
 
Now that mobile data prices have sky rocked up; will shop else where for my mobile data means. Thank you MTN R10 per gig night surfer is a steal

Hello RichardG,where do you find this deal on MTN's website? Cant find it anywhere ,what is it called?
 
Personally hope they can challenge the big boys. Their packages are the best value for money in my opinion. It's just that their network sucks. Hopefully over the coming years, they can improve on that.
 
Personally hope they can challenge the big boys. Their packages are the best value for money in my opinion. It's just that their network sucks. Hopefully over the coming years, they can improve on that.

As always, depending on the area, their network is great. Recently, they've allowed you to roam on MTN's network at no additional costs.
 
Personally hope they can challenge the big boys. Their packages are the best value for money in my opinion. It's just that their network sucks. Hopefully over the coming years, they can improve on that.
Roam permanently on MTN... ;)
 
Well they get my money every month.
 
I have found their value (sim only) to be better than the other providers, quite happy with their coverage, but roam when required.
 
As always, depending on the area, their network is great. Recently, they've allowed you to roam on MTN's network at no additional costs.
They charge more for it. This would really be a great opportunity for someone like Cell C to come to the party with cheaper on-net bundles to cover the gap Telkom left.
 
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