Telkom sheds more than 2,000 jobs

Telkom shed more than 2,000 permanent jobs over the past year, or 12.5% of its workforce, the group said in a financial statement for the year ended March 2019.

The operator noted that permanent jobs declined to 15,296 from 17,472 in the prior year – a loss of 2,176 people.

“The decrease in permanent workforce was primarily due to VSP’s (voluntary severance package) and VERP’s (voluntary early retirement packages) offered and the section 189 process,” it said.

Telkom has reduced its headcount in its main consumer business (Telkom Company) from over 21,200 people in FY 2013. At a group level, Telkom merged with BCX in 2016, which added almost 8,000 employees to the group.

On Monday, the group reported a 5.3% jump in operating revenue to R41.8 billion, spurred by strong growth in its mobile division. However, its fixed-broadband subscribers recorded the biggest decline ever.

The results showed that Telkom’s ADSL, VDSL, and fibre subscribers declined from 981,176 in March 2018 to 847,650 in March 2019.

Mobile service revenue increase by 58.3%. “The significant growth in mobile service revenue was supported by an 85.9% growth in active subscribers to 9.7 million, as our affordable broadband-led proposition continues to resonate with customers,” said group CEO, Sipho Maseko.

“Despite adding 4.5 million subscribers in the year, our blended average revenue per user (ARPU) was stable at R100.”

Maseko said that pre-paid subscribers more than doubled compared to the prior year, increasing by 109.3% to 7.8 million.

Key salient features:

  • Group operating revenue up 5.3% to R41.8 billion
  • EBITDA up 8.5% to R11.3 billion
  • Headline earnings per share was up 22.6% to 722.4 cents per share.
  • Capex of R7.7 billion with capex to revenue ratio of 18.4%
  • Final ordinary dividend of 249 cents taking the annual dividend to 362 cents, an increase of  2.0% year on year

The racial breakdown of permanent employees within the reporting year comprised of 64% black South Africans, 33%white South Africans and 3%non-South Africans, the group said.

“In total, 35% of our external recruitment was made up of women. It remains a challenge to realise gender equality and female representation which aligns to the challenges of the broader ICT sector. Within the group, women represent 31% of our employee base,” Maseko said.

“Our top management black representation increased from 62% to 100%.”

Read: Telkom delivers strong growth on mobile customer surge

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Telkom sheds more than 2,000 jobs