Blue Label Telecoms has issued a trading statement for the six-month period ended 30 November 2019, alerting shareholders to a sharp change in earnings.
The group has announced that its basic, headline and core headline earnings per share for the period are expected to increase by more than 20% in comparison to the previous corresponding reporting period.
This translates to basic, headline and core headline earnings per share improving by at least 2.52 cents, 3.00 cents and 2.28 cents compared to the reported losses on basic, headline and core headline per share of 12.59 cents, 15.02 cents and 11.39 cents achieved as at 30 November 2018 respectively.
The company states that, for the six months ended 30 November 2018, fair value losses totaling R493-million and the group’s share of equity accounted losses in Cell C amounting to R133-million were recognised.
No further fair value losses related to the SPV’s were recognised in the current reporting period as the exposure to the SPV’s has been fully accounted for as at 31 May 2019.
As the carrying value of Blue Label’s investment in Cell C was fully impaired for the year ended 31 May 2019, the financial results of Cell C during the current period will not have an impact on Blue Label’s earnings for the current reporting period.
According to the statement from Blue Label Telecoms, these two factors are the primary contributors to the expected growth in earnings.