Cell C reports R588 million loss as recapitalisation forges ahead

South Africa’s third largest mobile operator Cell C has reported a R588 million loss in its interim results for 2017, down from a small profit of R3 million in the same period last year.

In an investor presentation published by Blue Label Telecom in Thursday, the group reported total revenue for the period up to R7.7 billion (2016: R6.96 billion), with earnings before interest, tax, depreciation and amortisation at R1.6 billion (2016: 1.38 billion).

Cell C reported subscriber growth of 12% year-on-year, from 14 million customers to 15.7 million, and reported a blended ARPU of R75, the same as the previous period. The group projected that the South African mobile market would reach 88 million connections in 2017, of which it expects to capture a 16.6% share.

Data revenue was up 33% to R2.6 billion (from R1.95 billion), with data traffic growing 84%. The operator has 8.1 million smartphones on its network. Total South African mobile service revenue is projected to hit R108 billion, of which Cell C anticipates a 11.7% share.

Regarding its fibre business, Cell C said it had installed 3,615 new connections in the reporting period.

Cell C said its capex was strategically focused to provide mobile voice and data services through a combination of its own LTE-Advance network overlaying its LTE, 3G and 2G networks.

Capex slowed in H1 2017 due to the delayed recapitalisation but is expected to pick up again post recapitalisation, it said.

Recapitalisation

The group is currently processing a recapitalisation strategy through Blue Label Telecoms and other partners, which will see the operator’s shareholding shift. Blue Label will have an effective 45% stake in the group, with Net1 holding 15%, and other special purpose vehicles owning minority stakes.

Updating the regulatory proceedings, Cell C said that it has provided detailed submissions to the Independent Communications Authority of South Africa (Icasa) and is dealing with complaints laid by its BEE partner, CellSAf, to the Competition Commission.

CellSAf has also initiated court proceedings, which is unlikely to be heard before 2019, Cell C said.


Read: Cell C launches video on demand service with live-streaming and sports channels

Must Read

Partner Content

Show comments

Trending Now

Follow Us

Cell C reports R588 million loss as recapitalisation forges ahead