EcoCash transactions top $6,6bn

HARARE - Econet Wireless Zimbabwe (Econet) says it will continue investing in infrastructure to diversify its revenue streams after the company’s mobile money platform, EcoCash, moved over $6,6 billion since its launch five years ago.

“The local telecommunication industry in line with global trends is experiencing a decline in voice revenues. We long saw this trend and over the years we have invested in our infrastructure and created an innovation pipeline to create new revenue streams,” Econet chief executive Douglas Mboweni said yesterday.

“In a shrinking industry we have maintained market dominance getting 70 percent of the value share while aggressively growing our broadband and mobile financial services,” he said.

Mboweni noted that Econet, which has invested over $1,2 billion in infrastructure since 2009, was overcoming disruptive technology cycles and strong economic headwinds through a robust business model.

“The declining voice revenues will be eased by incentives and packages that suit declining disposable incomes and growing our broadband through wider 4G/ LTE coverage, offering affordable smartphones and rolling broadband to the home,” he said.

Zimbabwe’s largest mobile telecommunication company by subscriber base’s focus will also be on growing mobile financial services through promoting EcoCash as a premier mobile merchant payment platform and broadening mobile insurance offering, Mboweni said.

“The entry of the ground-breaking media service, Kwese TV will enable us to offer media and entertainment services for our clients creating further headroom for value,” he added.

Meanwhile, Econet’s revenue in the full year to February 2016 declined 14,1 percent $641,0 million from $746,2 million recorded in the same period last year.

The company also registered a $40,2 million after tax profit, impacted by high depreciation amounting to $136,8 million.

Earnings before interest, taxes, depreciation and amortisation was 16,5 percent down at $238,4 million from $285,6 million recorded in the prior period.

“These results reflect the impact of the regulatory tariff reductions as well as a cocktail of taxes and levies which include five percent excise duty and the increase in USF levy,” Econet finance director Roy Chimanikire said.

“This has effectively reduced our tariffs while directly increasing our costs through additional tax burden. Through an aggressive cost optimisation programme we are ensuring that we protect the bottom line,” he said.

In the period under review, Econet recorded a nine percent growth in subscriber base from 9,2 million last year to the current 10 million.

The growth was in spite of the over one million subscribers who were deregistered in compliance with regulatory requirements for proper registration.

The company said revenue lost from the deregistered subscribers amounted to $2 million and the cost to reconnect the subscribers came to $500 000.

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