Telkom South Africa posts results after challenging year

Telkom South Africa has reported group operating revenue of ZAR32.5 billion (USD3.2 billion) for the twelve months ending 31 March 2013, down 1.7% year-on-year. The company recorded a 5% increase in data revenues on the back of its ADSL subscriber base growing 5.2% to 870,505. However, this failed to offset a 4.8% drop in voice telephony sales due to continued mobile substitution, coupled with a 13.9% decline in interconnection revenues. EBITDA slipped almost 17% year-on-year to ZAR7.1 billion as workforce reduction expenses – including voluntary severance and early retirement packages – soared from ZAR29 million to ZAR753 million. Operating income, meanwhile, plunged from a profit of ZAR2.4 billion in the year ending 31 March 2012 to a loss of more than ZAR11 billion, primarily due to a ZAR12 billion impairment of legacy assets. Mobile subscribers increased by 3.4% to just over 1.5 million, but monthly ARPU over the year dropped by more than 17% to ZAR61.5 (USD6.1).