Blue Label Telecoms has reported a revenue increase, to R13,5-billion, for the six months ended 30 November 2017.
The company increased EBIDTA by 9% to R778-million.
Earnings per share were up 110% to 167.43 cents, headline earnings per share rose 109% to 166.68 cents and core headline earnings per share grew 108% to 168.42 cents.
The organisation increased the cash generated from operating activities to R3,1-billion. On inclusion of the gross amount generated on “PINless top-ups”, the effective increase equated to 10
On 2 August 2017, Blue Label, through its wholly owned subsidiary The Prepaid Company, acquired 45% of Cell C and 47.37% of 3G Mobile for R5,5-billion and R0,9-billion respectively.
Earnings comprised the group’s share of profits in Cell C of R928-million, which included the recognition of an increase in a deferred tax asset of R1,92-billion, of which the group’s 45% share amounted to R865-million, and its share of profits in 3G Mobile of R36-million.
The balance pertained to the remaining companies within the group, inclusive of once-off costs of an imputed IFRS interest adjustment of R21-million attributable to the deferred payment of R650-million relating to the acquisition of 3G Mobile.
The core headline earnings in the current period were negatively impacted by R91-million as a result of the cessation of early settlement discounts and interest forfeiture in lieu of the utilisation of working capital resources to fund the cash element of the Cell C acquisition.
Growth in revenue of 2% was organically achieved through continued expansion of distribution channels. Amounts generated on “PINless top-ups” increased by R1,2-billion from R2,8-billion to R4-billion, equating to an effective increase in South African Distribution of 10%, in that only the gross profit earned thereon is recognised.
Net commissions earned on the distribution of prepaid electricity continued to increase, escalating by R21-million to R124-million (21%) on an increase in revenue generated on behalf of the utilities from R6,9-billion to R8,4-billion (20%).
Gross profit margins declined from 7,84% to 7,68%, primarily attributable to the forfeiture of R50-million of early settlement discounts in lieu of the utilisation of working capital resources to fund the cash element of the Cell C acquisition.