Altron intends hanging tough with subsidiary Altech Autopage. The diversified technology group’s CEO, Robbie Venter, says it has no plans to sell Autopage or its million-strong subscriber base after rival Reunert announced in April that it would sell subsidiary Nashua Mobile’s base and shut down the business.
The decision by Reunert means Autopage will soon be the last remaining independent cellular service provider in South Africa. But Venter says Altron has no intention of following Reunert’s lead, at least not in the immediate future.
In the 2014 financial year, which ended in February, Autopage reported a 9% decline in revenue to R5,5bn, from R6bn in 2013. Earnings before interest, tax, depreciation and amortisation climbed by 3%, although Altron has warned that this performance is unlikely to be repeated given margin pressure in the channel.
Average revenue per user (Arpu) has continued to decline, though at a slower rate, Altron says in notes accompanying its annual financial results published on Wednesday.
“Arpu on new subscribers is encouraging, while churn is being maintained at better than industry acceptable levels,” the group says. “The number of subscribers increased to approximately 1m and full-circle data and telephony offerings to enterprises increased.”
Venter says Autopage is accelerating its efforts to transform itself from a pure GSM voice player into a managed services business where voice is only one of many offerings.
It intends focusing on the corporate market and on high-net-worth individuals.
The Internet service provider business in Bytes, another Altron subsidiary, has been folded into Autopage and this follows the integration of another Internet business, Altech Technology Concepts.
Venter says the 9% decline in revenue at Autopage reflects the growing pricing pressures in the broader mobile industry.
Last year, Autopage signed a fresh five-year service provider agreement with Vodacom. It is currently in advanced negotiations with MTN, too, with that deal expected to be signed by late June or early July, according to Venter.
“It is a tough negotiation. We understand the pressures they are under and they understand our pressures. The likelihood is that the MTN agreement will not be too dissimilar from the one we signed with Vodacom.” — (c) 2014 NewsCentral Media
