Blue Label Telecoms, the largest shareholder in mobile operator Cell C, said on Wednesday that its full-year core headline earnings per share will take a knock after once-off effects are taken into account.
Excluding the positive and negative contributions from both the 2024 and 2023 financial years – mainly resulting from the recapitalisation of Cell C — earnings per share and headline earnings per share in the latest reporting period will have declined by more than a third to 65.07c and 66.22c/share, respectively, it said in a trading update.
However, reported core headline earnings per share will rise by more than 65%.
“Excluding the positive contributions of R66-million in the current year, and the negative contributions of R523-million in the comparative year, primarily resulting from the recapitalisation transaction of Cell C, core headline earnings declined by R312-million (34%) from R925-million to R613-million,” the company said.
“Consequently, core headline earnings per share also dropped by 34%, from 104.83c/share to 68.66c/ share.”
Blue Label, which will report its annual results to end-May 2024 next week, provided no insight into the reason for the decline in its underlying core earnings.
The publication of the results next week comes as Blue Label works through the regulatory processes to take control of Cell C and comes after the mobile operator last week unveiled a new brand identity and signalled to the market that it was ready for a fight with bigger rivals Vodacom and MTN in South Africa’s competitive mobile telecommunications industry.
Shares jump
Blue Label’s annual results should provide some insight into whether the turnaround strategy at Cell C, which is being led by CEO Jorge Mendes, is gaining traction.
Investors, meanwhile, have cheered the trading update, sending Blue Label shares more than 12% higher in intraday trade on the JSE on Wednesday. As at 1.35pm, they were trading 12.02% higher at R4.94 apiece. Up to Tuesday’s close, Blue Label’s shares had gained more than 30% over the past 12 months. – © 2024 NewsCentral Media
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