{"id":16435,"date":"2012-06-25T18:37:27","date_gmt":"2012-06-25T16:37:27","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=16435"},"modified":"2012-06-26T10:49:45","modified_gmt":"2012-06-26T08:49:45","slug":"lcr-sinks-telemasters","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/telecommunications\/16435\/lcr-sinks-telemasters\/","title":{"rendered":"LCR sinks TeleMasters"},"content":{"rendered":"

Fixed-line telecoms service provider, TeleMasters<\/a> on Monday (25 June) announced an operating loss of R2.33 million and R3.72 million for the quarter and six month period ended March 2012, from profit of R5.12 million and R10.19 million respectively.<\/p>\n

Quarterly revenue declined to R43.65 million from R71.76 million, while revenue for the six month period slipped to R99.6 million, from R157.99 million in 2011.<\/p>\n

TeleMasters reported a diluted headline loss per share of 4.44 cents for the quarter ended March 2012, from diluted HEPS<\/a> of 7.67 cents, with a diluted headline loss per share of 6.94 cents for the six months ended March 2012, versus diluted HEPS of 15.67 cents in 2011.<\/p>\n

\u201cThe second quarter results reflect management’s continued expectations as voiced earlier that 2012 will be a tough transitional year. The traditional least-cost routing (LCR)<\/a> turnover decreased by 41% over the corresponding previous period due to the loss of 2 large clients that reached the end of tender periods,\u201d TeleMasters said.<\/p>\n

As reported previously, the group notes that the LCR model no longer makes sense as the new interconnect rates have squeezed the margins out of the old technology.<\/p>\n

\u201cWe have chosen to move the manner in which we offer telecommunications solutions to clients and have developed a highly innovative service offering which has a built-in redundancy giving us a very competitive edge over similar type but inferior offerings in the market,\u201d it said.<\/p>\n

TeleMasters said the challenge is to exceed the loss of revenue with the conversion of 600 long-standing current clients and the acquisition of new clients to the company’s new Digital Direct service.<\/p>\n

The group said that the conversions on to the new platform remain slower than expected due to reliance on third party fixed line service providers interconnect implementation and delays with the porting of telephone numbers to TeleMasters.<\/p>\n

“The increase in revenue over our\u00a0new Digital Direct platform has increased 100% when compared to the comparative\u00a0period and continues to grow. Our added value services which we implemented in\u00a0the last six months of the previous year have provided additional revenue of\u00a0approximately 2% of our total revenue when compared to the prior year,” the group said.<\/p>\n

TeleMasters said that an additional R4.9 million has been invested since year end in capital acquisitions\u00a0in order to convert its clients on to its new platform which requires a greater\u00a0investment than the previous LCR solution required. “As a result of our
\ninterconnect agreements having now been concluded, we will see in the medium
\nterm an improvement in margins as our clients are converted on to the new
\nplatform. This offers better margins at the expense of the larger initial
\ninvestment in hardware.”<\/p>\n

The group said its operating expenditure has remained constant and\u00a0efforts to reduce the fixed operating costs would be evident in its next\u00a0quarter’s results. “We have successfully completed a retrenchment process to\u00a0reduce staff to be in line with our lower Revenue streams whilst we rebuild our\u00a0customer service offering.”<\/p>\n

As part of the efforts to drive down the group’s operating\u00a0expenditure the board of directors decreased executive and non-executive directors remuneration by 33% until such time as TeleMasters return the company to\u00a0profitability. “We remain confident of our ability to do so in the shorter term\u00a0despite the fact that for all practical purposes we have had to re-invent the\u00a0company to adapt to changes in the way in which business communicates,” it said.<\/p>\n

The board declared a second quarter interim dividend of 1 cent per share on 30
\nMarch 2012. During the second quarter of the prior financial year, which ended on 31 March 2011, the company declared an interim dividend of 4 cents per share for that quarter.<\/p>\n

\u00a0Relates Articles:<\/strong><\/p>\n

TeleMasters set for JSE delisting<\/strong><\/a><\/p>\n

TeleMasters announces operating loss<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Fixed-line telecoms service provider, TeleMasters on Monday announced an operating loss of R2.33 million and R3.72 million for the quarter and six month period ended March 2012, from profit of R5.12 million and R10.19 million respectively.<\/p>\n","protected":false},"author":9,"featured_media":3739,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[26,2670,1549,317],"class_list":["post-16435","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-telecommunications","tag-headline","tag-lcr","tag-least-cost-routing","tag-telemasters"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/16435","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=16435"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/16435\/revisions"}],"predecessor-version":[{"id":16469,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/16435\/revisions\/16469"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/3739"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=16435"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=16435"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=16435"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}