Multi-Links Telkom's top priority
“We view the situation at Multi-Links in Nigeria in a seriouslight,” Telkom’s CEO Reuben September told a results presentation in Sandton, Johannesburg.
On Monday, the group released its results for the 2009 financial year which showed a 45.9 percent fall in headline earnings per share.
Net income decreased by 47.7 percent to R4.17 billion in the year ended March 31, 2009.
The results showed that Telkom’s Nigerian operations had made a loss of R1,76 billion.
“Nigeria is not immune to the global meltdown — it’s an oil based economy,” September said.
“We saw the weakening of the naira against the dollar… we ended up with a forex loss of R902 million.”
Turnaround plans including increasing Multi-Link’s focus on corporate and small, medium and micro enterprise (SMME) markets.
Another plan was to increase revenue from fixed-wireless and mobile customers through “brand awareness and promotion”, September noted.
Multi-Links would also expand broadband internet to offer high-value bundles.
Through its extensive fibre network it will provide high quality internet protocol/next generation network services to the government, corporate and SMME customers while extending its metro-ethernet services, September added.
Average revenue per user, which fell from US32 to US9 during the year has been targeted at US10 for the next year, Telkom’s CEO said.
September added that capital expenditure of US100 million for the 2009/10 financial year had been budgeted for — with the primary objective of adding an additional 1000km of fibre.
Telkom planned to have a national fibre network in place that would connect all major cities with metro fibre rings in Nigeria’s top five cities, September said.
“We expect Multi-Links to be cash flow positive by 2011/12,” he added.
Turning around Multi-Link’s performance was vital to Telkom “given the extent of the group’s investment and the enormous opportunity the Nigerian market provides”, September said.
Telkom acquired 75 percent of Multi-Links in 2007 and in 2009, it purchased the remaining 25 percent.
Telkom and Multi-Links – give your views
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