Telkom’s share price fell to new multi-year lows on Thursday of below R30/share after it warned the market of poor financial performance in the six-month period ended 30 September 2011 and after it said it would take a further R1bn profit hit related to its disastrous investment in Multi-Links in Nigeria.
Telkom said Multi-Links delivered an operating loss of R269m in the six-month period. The Multi-Links operation will be reported as a discontinued operation after the group sold the business earlier this year.
In addition, the sale of Multi-Links will result in a net loss of approximately R1bn, mainly due to the “cumulative amount of exchange differences, previously recognised in non-distributable reserves, being realised”.
This loss will be reported in the second half of the financial year, Telkom said in the statement.
The troubled telecommunications group, which is 40% held by government, warned it expects headline earnings per share from continuing operations to be between 33% and 38% lower than the same period a year ago. Basic earnings per share from continuing operations are expected to be between 68% and 73% lower.
Telkom intends publishing its interim results on 21 November. — Staff reporter, TechCentral
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