Telkom bull charges through R50 a share
Telkom briefly hit the R50 on the Johannesburg Stock Exchange (JSE) on Tuesday, as the group continues its remarkable turnaround.
Shares in the group reached the big psychological level of R50 in the morning session on Tuesday (7 July), a number it last traded at prior to its unbundling of Vodacom in April 2009.
By 15h00, shares in the group advanced 2.55%, to R49.86, on the local bourse, taking its market cap beyond R25.8 billion and showing remarkable growth of 178% over the past year.
Telkom Group CEO, Sipho Maseko said recently that the group deserves 8.5 out of 10 for the progress it has made over the past year.
In June, the group reported an operating profit of R4.6 billion for the year ended March 2014, from a prior loss of R11.15 billion in 2013.
Headline earnings per share, excluding the once off items, increased 35.1% to 388 cents, Telkom said, adding that it may return to dividend payouts in 2015, having last delivered a dividend in 2011.
Telkom has entered into an agreement to acquire listed ICT group, Business Connexion (BCX) in a R2.7 billion cash offer, while the group also entered into an infrastructure sharing deal with MTN over its Telkom Mobile business.
Both deals are awaiting competition approval.
The group is facing complaints from union’s regarding its current retrenchment process as company aims to save R5 billion in costs over the short to medium term.
Looking ahead, the chief executive said: “We think though that the headwinds we are going to be confronting are very strong. The economy is getting soft, disposable income is getting very tight, people will be making very serious choices about how they spend their money…you are competing with a lot of things.”
However, he remains optimistic. “It’s a great start, but its like a boxing match, 15 rounds, and we’ve just completed one round and we were not knocked out, its not like we won the round, but we were not knocked out and we still have to go for another 14 rounds. But we are still on our feet and the energy is coming back,” Maseko said.
“I really think this is our time,” the company lead said.
More on Telkom
Telkom to acquire Business Connexion
Loading ...