Remgro released its financial results for the year ended 30 June 2021, which revealed a strong performance of Community Investment Ventures Holdings (CIVH).
CIVH is a growing telecommunications player through its subsidiaries, Vumatel and Dark Fibre Africa Proprietary (DFA). These two companies did well during the pandemic.
Vumatel’s revenue increased by 50.1% to R2.4 billion over the last year, driven by accumulated subscriber uptake growth.
DFA’s revenue increased from R2.465 billion in 2020 to R2.483 billion in 2021. DFA’s annuity income was R192 million per month on 31 March 2021, up from R179 million per month a year earlier.
Despite the strong revenue growth, CIVH made a loss of R797 million over the last year. It was partly a result of financing costs.
The loss is significantly lower than last year due to an increase in annuity income at DFA and subscriber growth at Vumatel.
CIVH’s improved financial performance and continued fibre infrastructure saw the company’s valuation jump over the last year.
As of 30 June 2021, Remgro owned a 55.17% share of CIVH, which it valued at R12.054 billion. This gave CIVH a total valuation of around R22 billion on 30 June.
On 19 July 2021, Remgro announced that a rights offer was being undertaken by CIVH to raise R3.72 billion at a pre-money valuation of R23.2 billion.
The R3.72 billion raised in July increased CIVH’s valuation to R27 billion.
This valuation makes CIVH, and hence Vumatel and DFA, more valuable than Telkom, Rain, and Blue Label Telecoms, which has a 45% share in Cell C.
The table below provides an overview of how CIVH’s valuation stacks up against other telecommunications players.
|Telecommunications Company Valuations|
|CIVH (Vumatel and DFA)||Remgro valuation||R27 billion|
|Telkom||JSE market cap||R22 billion|
|Rain||ARC valuation||R16 billion|
|Blue Label Telecoms (with 45% of Cell C)||JSE market cap||R5 billion|