Telkom shares slump below R20
Telkom shares dropped below R20 for the first time in almost a decade on Monday (11 June), following disappointing full-year results and no clear guidance on a way forward, according to a local trader.
In late afternoon trade on the JSE, shares in Telkom moved 88 cents or 4.33% lower to R19.42, having lost almost 45% of its share price from a year ago, trading at R36 over the same period in June 2011.
The All Share Index traded 0.38% higher to 33,793 points.
On Friday Telkom on Friday reported a decline in operating revenue to R33.1 billion, for the year ended March 2012.
Headline profit for the year fell 32.8% to R1.658 billion, while profit after tax for the year declined 93% to R179 million.
Earnings before interest, taxes, depreciation, and amortization (EBITDA) of R8.5 billion, declined 8.8% and group EBITDA margin decreased to 25.8% from 28.1%.
Headline earnings per share decreased 33.0% to 324.7 cents per share and basic earnings per share decreased 97.8% to 10.4 cents.
The group decided against a dividend declaration in respect of the financial year
ended 31 March 2012.
“The fact that the group failed to pay any dividends, and with no clear guidance going forward,” has led many investors to look elsewhere,” a dealer said.
Telkom’s mobile arm 8ta, achieved revenue of R1.200 billion and an EBITDA loss before inter-segmental eliminations of R2.425 billion for the year ended 31 March 2012. The group is not expecting to break even for several years yet, while government recently blocked a potential R3.3 billion deal with Korea based KT Corp, who was hoping for a 20% stake in Telkom.
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