Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      Yaccarino out: Musk’s handpicked CEO quits X suddenly

      9 July 2025

      AI gold rush propels Nvidia to record $4-trillion market cap

      9 July 2025

      Price hike for .za domains

      9 July 2025

      The satellite broadband operators taking on Starlink

      9 July 2025

      China’s Temu ups ante with South African warehouse launch

      9 July 2025
    • World

      Cupertino vs Brussels: Apple challenges Big Tech crackdown

      7 July 2025

      Grammarly acquires e-mail start-up Superhuman

      1 July 2025

      Apple considers ditching its own AI in Siri overhaul

      1 July 2025

      Jony Ive’s first AI gadget could be … a pen

      30 June 2025

      Bumper orders for Xiaomi’s YU7 SUV heighten threat to Tesla

      27 June 2025
    • In-depth

      Siemens is battling Big Tech for AI supremacy in factories

      24 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025
    • TCS

      TCS | Connecting Saffas – Renier Lombard on The Lekker Network

      7 July 2025

      TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

      4 July 2025

      TCS | Tech, townships and tenacity: Spar’s plan to win with Spar2U

      3 July 2025

      TCS+ | First Distribution on the latest and greatest cloud technologies

      27 June 2025

      TCS+ | First Distribution on data governance in hybrid cloud environments

      27 June 2025
    • Opinion

      In defence of equity alternatives for BEE

      30 June 2025

      E-commerce in ICT distribution: enabler or disruptor?

      30 June 2025

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Investment » Investors lost trust in us, Blue Label’s co-founders admit

    Investors lost trust in us, Blue Label’s co-founders admit

    By Duncan McLeod24 February 2022
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Blue Label co-CEOs Mark and Brett Levy

    Mark and Brett Levy, the sibling co-founders and co-CEOs of Blue Label Telecoms, have admitted that their deal to buy 45% of Cell C for R5.5-billion in 2016 was a mistake. But they have also expressed their frustration that investors continue to punish Blue Label for it, despite the solid performance of the group in recent years.

    Mark Levy admitted this week that the underperformance of Blue Label’s share price, despite strong earnings growth in recent years, is “frustrating” to him and his brother. But they believe the looming recapitalisation of Cell C could be the trigger than unlocks a significant rerating in the Blue Label share price, which is languishing at about R5, well below its all-time high above R20.

    Brett Levy said the group is trading at a price-earnings multiple (calculated using earnings before interest, tax, depreciation and amortisation) of about 3.5 times, grossly undervaluing the group given its earnings growth, cash generation and underlying assets.

    No one can dispute that it’s undervalued relative to what the company is, and produces, and has

    “No one can dispute that it’s undervalued relative to what the company is, and produces, and has,” he said.

    Blue Label on Wednesday reported interim financial results for the six months ended 30 November 2021 that showed headline earnings per share rose by almost 50% to 60.86c. It generated net cash from operating activities of R862-million, taking its cash balance at the end of the period to R2.94-billion, or more than 60% of its market capitalisation of R4.85-billion.

    Since the ill-fated 2016 deal, Blue Label has written off the carrying value of Cell C shareholding in its entirety. It has also dramatically reduced the debt it incurred through that deal by selling assets, with its balance sheet in a much healthier position today than it has been for years. It has also exited its loss-making ventures in India and Mexico to focus on growing the South African business.

    “Profits and cash have increased, but until we put out a very firm statement on the Cell C recap and where it is, we are ‘binary’ to investors… Without the Cell C exposure, you’ll see Blue Label run.”

    ‘Frustrating’

    Asked whether investors lost trust in the leadership team after the disastrous Cell C investment and whether this was the reason for the continued depressed share price, Brett Levy said: “We had to prove ourselves again, and I think we have. You lose trust in a day, and it takes years to get it back. But we are definitely on the right track.”

    Mark Levy added: “Cell C has shut people’s minds to all the good stuff that is happening. We are not getting adjudicated on what we are doing. It always slants towards Cell C. Investors should focus their time and attention on how this business is growing… It’s frustrating if you look at what has been happening over last three to five years, at how much this business has transformed. It’s not getting the attention it deserves because of this binary notion of Blue Label and Cell C.”

    “People trust you, then you make mistakes, and then they don’t trust you. But you have to earn the trust back. That’s the holding pattern Mark and I are in right now. We are slowly building trust again,” Brett Levy said.  – © 2022 NewsCentral Media



    Blue Label Telecoms Brett Levy Mark Levy
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleSouth Africa declares war on cable thieves
    Next Article Vumatel buys 45% of Herotel

    Related Posts

    TCS | Signal restored: Unpacking the Blue Label and Cell C turnaround

    28 May 2025

    The CEOs who run South Africa’s listed tech companies

    25 May 2025

    Cell C may list on the JSE as Blue Label eyes big restructuring

    16 May 2025
    Company News

    Samsung unfolds the future with thinnest, lightest Galaxy Z Fold yet

    9 July 2025

    Huawei supercharges South African SMEs with over 20 new eKit products

    9 July 2025

    Webtonic cracks the talent code with AWS-powered TonicHub

    9 July 2025
    Opinion

    In defence of equity alternatives for BEE

    30 June 2025

    E-commerce in ICT distribution: enabler or disruptor?

    30 June 2025

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.