NetOne revenue increases

HARARE - State-owned mobile telecommunications operator NetOne has said its revenue in the five months to May 2016 grew 9,48 percent to $48,5 million compared to $44,3 million in the previous corresponding period.

The company’s chief finance officer, Sibusisiwe Ndlovu, on Monday told a parliamentary portfolio committee on Information Communication and Technology that NetOne’s gross profit for the period under review surged to $34 million from $29 million registered in May 2015 on the back of cost reduction.

Although NetOne reduced its cost of sales to $13,9 million during the five-month period from $15 million last year, losses for the period widened to $2,1 million from $1,1 million same period last year.

Ndlovu attributed the losses to “high overheads and legacy issues”.

NetOne’s overheads increased to $23 million from $20,6 prior year comparable attributed to additional company units which were not being recorded in prior periods.

Meanwhile, the country’s second largest mobile company by subscriber said it was on its way to revival following a significant growth in daily revenues from $250 000 at the beginning of this year to $300 000 in May.

“We are transforming the business from being network centric to customer centric and we are now seeing the fruits, NetOne acting chief executive Brian Mutandiro said.

“We anticipate a second-half recovery which will drive our revenues and hopefully by year end we will declare a dividend to the shareholder,” he added.

The parastatal’s acting chairman Sydney Nyanungo also told Parliament that the board would only decide the future of the Reward Kangai-led suspended management after completion of an on-going forensic audit.

This comes as the board in March suspended Kangai for three months to pave way for investigations at the parastatal over flawed internal procurement systems.

The acting chair also pointed out that mismanagement by the suspended top brass could have affected business performance over the years.

NetOne, which received equipment valued at over $160 million from China, is presently expanding its infrastructure network across the country.

The infrastructure expansion project — being supported by a $218 million loan from China’s Eximbank — is expected to be complete by the end of this half year.

To date, the project has seen NetOne having the widest fourth generation (4G) technology long term evolution and is targeting to double its subscriber base to eight million.

 

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