Telkom has delayed the publication of its annual results by two months due to the effect of the coronavirus outbreak and national lockdown on its business.
“The institution of the lockdown has impeded the company’s ability to complete the necessary work required to finalise the annual results by 25 May 2020 and accordingly the board of directors considers it prudent and in the best interests of the company to utilise the two-month extension period,” Telkom said in a statement to shareholders.
“Given that the company’s financial year-end is 31 March 2020, the company will issue its annual results on 22 June 2020, and the integrated report incorporating the full annual financial statements and the notice of annual general meeting on 7 August 2020.”
“Telkom’s portfolio of businesses is exposed to all sectors of the economy including the sectors that are in distress,” it added.
The company said that it was assessing the impact of COVID-19 across its businesses and it is revising its business continuity plans accordingly.
Telkom’s market capitalisation has also dropped below its net asset value over the past few months, which indicates grounds for impairment testing.
“This will be considered together with the impact of COVID-19 on our business,” Telkom said.
operating during COVID-19
Telkom said that it proactively designed and implemented measures that will mitigate against the COVID-19 outbreak.
“Telkom’s number one priority is the health and safety of its employees, with approximately 80% of our employees having been empowered to work from home, while our frontline staff and field service technicians continue to serve customers,” the company said.
The company added that it expected to be downgraded by S&P Global Ratings following the agency’s downgrade of the national government.
“The ratings agency views Telkom as a government-related entity and we, therefore, based on this action, anticipate a review of Telkom’s rating by S&P”.
“Any possible rating action by S&P and the Moody’s downgrade of Telkom’s credit rating in line with sovereign rating’s downgrade on 7 April 2020, does not trigger any loan covenants,” Telkom added.
“Shareholders are advised that cash outflow relating to the Telkom’s restructuring process and the Tax matter before the Courts will be funded out of cash balances including a liquidation of the short-term investment, resulting in not raising additional debt.”