Econet in profit decline, declares $12m dividend
HARARE, May 31, 2017 (New Ziana) –Zimbabwe’s biggest telecommunications company, Econet Wireless has posted a $36 million net profit for the year ended February, 2017, a slide from $40.2 million in the same period last year on the back of a drop in revenue.
The mobile operator saw its income drop three percent to $622 million which was attributed to the tough economic environment.
The firm, declared a $12.1 million dividend that will see shareholders being paid 0.467 cents per share.
“The strong focus on revenue diversification, stringent cost management as well as developing a corporate culture of disciplined execution and accountability has helped us to limit both a revenue and margin decline, while continuing to maintain our customer-centric focus,” said Econet chairman Dr James Myers.
Earnings before interest, taxation, depreciation and amortisation also declined in line with the drop in profit after tax to $224 million compared to $238 million in 2016.
In the year, the telecommunication firm cut its capital expenditure to $32.5 million from $82.8 million.
But its subscriber base jumped to 10 268 890 from 10 019 870.
Dr Myers said revenues from voice calls, once a cash cow, continued to decline as consumers switched to cheaper data applications.
He said the data and mobile financial services segment had upped its contribution to group revenue to 32 percent from 14 percent last year.
“This is happening against a backdrop of difficult economic conditions making it harder to generate sufficient capital from the current revenue streams to invest in new businesses of the future,” he said.
Dr Myers said Econet was now in a stronger position to deal with the challenges in the operating environment after it had successfully mobilised $130 million through a rights offer in the first quarter of the year to pay off its foreign creditors. – New Ziana