Zimbabwe’s mobile market leader Econet Wireless has announced that it has sourced the necessary funding to expand its network capacity to five million subscribers by the end of 2010. At the presentation of the cellco’s 2008/09 fiscal year results, CEO Douglas Mboweni said: ‘We have secured the resources, through our parent company, Econet Wireless Group (EWG), to expand capacity further, from the current 2.5 million [users] expansion programme, to go to five million.’ Under its current plan, geographical network coverage is set to be almost doubled by extending the footprint to many smaller towns and main roads whilst improving coverage in existing urban and resort areas, whilst an upgrade to 3G services is also in the pipeline. Mboweni said Econet’s financial team had travelled around the world raising funds with ‘spectacular success.’
Whilst in fiscal 2007/08 Econet’s income came almost exclusively from non-core investments, the financial statement this year features almost no investment income to bolster telecoms performance. Revenue for the twelve months to the end of February 2009 was USD87.9 million, and EBITDA was USD26.6 million, whilst it invested CAPEX of USD123.8 million. The company has re-valued its assets in US dollars, resulting in a depreciation charge of USD18.4 million, causing a net loss of USD2.1 million for the year. Total assets were valued at USD176.4 million whilst shareholders’ equity totals USD86.8 million. Econet began charging all customers in US dollars in the last two months of the financial year, which accounted for approximately one-third of the entire year’s turnover. Dollarisation has allowed it to pay off foreign creditors, and restore normal supply and contractor relationships which had been impaired by lack of access to foreign currency because of Zimbabwe’s hyperinflationary economy. Obsolete equipment is also being updated as part of the expansion programme, according to the company.
Econet reported that its GSM subscriber base increased by 84% in a year from 636,000 to 1.2 million at end-February 2009. It says it is currently signing up around 5,000 new customers per day, but expects to be able to increase this rate dramatically over the next few months as it installs more new network equipment.