While many technology companies only pursue business in Africa on an ad-hoc basis, Altech is enjoying the rewards of its long-term investments.
Global growth consulting company Frost & Sullivan suggests that Altech’s moves to secure sustainable business will continue to support the company’s growth.
“The company’s move to acquire shares in technology companies in Kenya and Uganda to the value of $80 million is a key indication of its commitment to the market,” notes Frost & Sullivan ICT industry analyst Lindsey Mc Donald. “The company’s steady growth is underpinned by this sort of long term vision investing and great support of its various businesses.”
Altech released its annual results today, showing total revenue up by 22%. The largest contributor to revenues continues to be the company’s telecommunications division, which upped revenues by nearly 20% from R4,976-billion in 2007 to R5,95-billion this year.
Bucking the global trend in mobile telecommunications of decreasing average revenue per user (ARPU), Altech improved this figure in the last financial year. It has achieved this by targeting high-end corporate and fixed cellular markets, and extending its data subscriber base.
“Altech’s ability to provide clients with a “one stop shop” service through its many units is a distinct advantage for the company,” Mc Donald notes. “It is able to maximise client value and to develop client relationships throughout the organisation. The ability to upsell and cross sell across various divisions is key to this advantage.”
Mc Donald suggests that Atech will continue to benefit from its strategic investments in Africa outside of South Africa. Soon to be published analysis from Frost & Sullivan shows that the Kenyan call centre market is poised for significant growth, and could be worth $19,3-million by 2013. Altech is in a good position to benefit from developments in this promising market.
“Altech’s establishment of operations in Kenya and Uganda means that it is very well positioned to benefit from positive growth in East Africa,” Mc Donald says. “These operations will also allow the company easy access to other countries within the region.”
Mc Donald does, however, warn that the economic downturn is likely to impact on Altech, as it will other companies, especially in those areas where high cost investments are required for substantial solutions – such as IT and security. The political unrest in Kenya could be perceived as an area of risk for Altech, but all indications are that this country’s technology sector continues to do well.