{"id":43963,"date":"2013-08-11T22:59:39","date_gmt":"2013-08-11T20:59:39","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=43963"},"modified":"2013-08-12T09:02:17","modified_gmt":"2013-08-12T07:02:17","slug":"infraco-to-continue-losing-money-fd","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/broadband\/43963\/infraco-to-continue-losing-money-fd\/","title":{"rendered":"Infraco losses to continue: FD"},"content":{"rendered":"

State-owned broadband infrastructure operator,\u00a0Broadband Infraco<\/a>\u00a0will continue to lose money for at least another two years, according to its chief financial officer, Ramasela Magoele<\/a>.<\/p>\n

Speaking at the company\u2019s results presentation in Woodmead on Thursday (8 August), Magoele said: \u201cWe have made a projection that in the next two years we are going to make losses, but we are working on a turnaround to reduce those losses. In the next financial year, those losses should come down.\u201d<\/p>\n

She said that, within three years, the group hoped to be profitable.<\/p>\n

Infraco reported a 40% decline in revenue for the financial year ended March 2013, to R237.4 million, citing shrinking volumes of business from\u00a0Neotel<\/a>.<\/p>\n

The group extended its operating loss to R181.1 million, from R95 million before, but noted that it invested R155 million during the course of the year.<\/p>\n

Puleng Kwele<\/a>, CEO of Broadband Infraco stressed that the company needed as \u00a0much as R1.1 billion to upgrade its network, already at 12,800km, over the next three years.<\/p>\n

The chief executive recently estimated that the South African government will need to set aside as much as R100 billion in order to meet its targets for broadband coverage for all by 2020.<\/p>\n

Kwele was also outspoken on the funding requirements needed by the group, noting that in the five years of its existence, Broadband Infraco had only received a total of R1.8 billion from government.<\/p>\n

Tshediso Matona<\/a>, director-general (DG) of the Department of Public Enterprises said that the struggling company should fend for itself.<\/p>\n

\u201cAs a commercial state owned company, we believe that the company has to fend for itself. All companies in the portfolio of the Department of Public Enterprises are characterised by that feature. They are commercial and therefore they have to fend for themselves,\u201d Motana said.<\/p>\n

However, Motana quickly added that in instances where there is a case to be made for the provision of fiscal support, \u201cwe will consider it\u201d.<\/p>\n

\u201cWe believe that Infraco faces challenges, many of them, not of their own\u2026we have taken it upon ourselves in supporting them in accessing fiscal support via national treasury. We will put in a bid for Infraco to get some support.\u201d<\/p>\n

Looking ahead, Infraco pointed to cash in hand of R343 million, adding that it \u201ccontinues to engage potential funders for additional funds to support its capital expansion programme”.<\/p>\n

Infraco sold 70% of its existing capacity on the West African Cable System to the Department of Science and Technology for the Square Kilometer Array project, a transaction valued at R600 million.<\/p>\n

\u201cThe company will pursue various funding models. Funding will also be sourced commercially, as well as private\u2013public partnerships, including cobuild projects,\u201d Kwele said.<\/p>\n

\u201cWe have got to be driving a government user-pays model\u2026 and the government has got to be an anchor. We are engaging with state owned companies,\u201d the CEO said.<\/p>\n

More on Broadband Infraco<\/h3>\n

Infraco hit by massive earnings drop<\/strong><\/a><\/p>\n

No signs of profit at Broadband Infraco<\/strong><\/a><\/p>\n

R100 billion needed for SA broadband: Infraco<\/strong><\/a><\/p>\n

CFO not suspended: Broadband Infraco<\/a><\/strong><\/p>\n

Broadband Infraco lifts revenue by 32%<\/strong><\/a><\/p>\n

Broadband Infraco appoints new CEO<\/strong><\/a><\/p>\n

Broadband Infraco to address cash position<\/a><\/strong><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Broadband Infraco will see further losses for at least another two years, according to its CFO, Ramasela Magoele.<\/p>\n","protected":false},"author":9,"featured_media":42997,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5553],"tags":[1876,26,5863,2950],"class_list":["post-43963","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-broadband","tag-broadband-infraco","tag-headline","tag-puleng-kwele","tag-square-kilometer-array"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43963","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=43963"}],"version-history":[{"count":9,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43963\/revisions"}],"predecessor-version":[{"id":43977,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43963\/revisions\/43977"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/42997"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=43963"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=43963"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=43963"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}