The strong full-year financial results published by Telkom on Monday “underscore the correctness” of government’s decision not to further privatise the JSE-listed company, telecommunications & postal services minister Siyabonga Cwele said in a statement.
Telkom reported a 12,4% improvement in headline earnings per share on the back of operating revenue that climbed 9,8%. The company reported a strong performance from its mobile division, although the number of fixed lines in service declined again.
“These strong results underscore the correctness of government’s decision, working with other shareholders, to invest in turning around the company instead of selling it,” Cwele said.
Former communications minister Dina Pule in 2012 blocked a plan by former CEO Nombulelo Moholi to sell a strategic stake in Telkom to Korea’s KT Corp. Pule’s decision was backed by cabinet, which rejected the plan.
“Since the cabinet decision of June 2012, shareholders reconstituted the board, which appointed a new management team,” Cwele said. “These changes have seen the company’s share price moving from a low of R12,50 to the recent R77,64.”
Cwele urged troubled state-owned companies to “learn from Telkom” about how it achieved its turnaround. He praised the company for achieving a strong performance despite the “tough global economic environment”.
“It is crucial that we make the cost of data and communication to be more affordable to ensure that more people meaningfully participate in shared economic growth. We call on all operators to look at ways in which costs can be brought down,” the minister added. — (c) 2017 NewsCentral Media