Despite having opened its doors more than 12 years ago, South Africa\u2019s third mobile operator, Cell C, is still some way off achieving profitability.<\/p>\n
Speaking at the company\u2019s headquarters in Midrand on Tuesday (13 May 2014), new CEO Jose Dos Santos outlined the company\u2019s growth over the past year, with total revenue up 14% year on year, and subscribers up 35% YoY to the end of December, 2013.<\/p>\n
\u201cI can say that our ebitda (earnings before interest, taxes, depreciation, and amortisation) growth has been good, and that our ebitda is positive\u2026quite extensively,\u201d Dos Santos said.<\/p>\n
\u201cIt is positive and growing,\u201d Robert Pasley, Cell C CFO added of the group\u2019s pre tax earnings.<\/p>\n
BusinessTech asked when Cell C might start to turn a profit, Dos Santos said: \u201cThat\u2019s for management and shareholders\u2026we debate that\u2026we don\u2019t want to comment. We have a strategy in place; we are in line with it.”<\/p>\n
\u201cWe did say that we wanted to have 20-25% revenue share within the next five years, one year has gone\u2026we are tracking that.\u201d<\/p>\n
Paisley said that the company\u2019s revenue share was at close to 12%.<\/p>\n
In July 2013, former CEO, Alan Knott-Craig said that Cell C was on a three year path to profitability, pointing out\u00a0that operators in SA needed a market share of between 20-25% to achieve that.<\/p>\n
On Tuesday, Dos Santos said that it signed up a record 1.6 million new subscribers in March 2014, taking its total subscriber base to 16.6 million.<\/p>\n
This compares to approximately 31 million Vodacom subscribers in SA, while MTN recently announced a drop of 825,000 subscribers to 24.9 million in the country.<\/p>\n
Dos Santos noted that in 2013, Cell C received equity injections of R2.6 billion, while an additional R1.5 billion has been injected so far in 2014.<\/p>\n
\u201cThe shareholders remain very supportive of Cell C,\u201d he said.<\/p>\n
The company also pointed to R1.8 billion local debt and $120 million foreign debt raised during 2013, \u201cto augment equity injections and support business expansion and capital investment\u201d.<\/p>\n
A further US$125 million foreign currency deal is near completion and is expected to increase to $200 million by year-end, Dos Santos said.<\/p>\n
\u201cWe continue to enjoy a very strong relationship with our local and international lenders including Nedbank, DBSA, CDB and others,\u201d he said.<\/p>\n
Dos Santos said that the group\u2019s capex forecast for 2014 is at R2.3 billion in 2014.<\/p>\n
Why Cell C won\u2019t be dead in 6 months<\/strong><\/a><\/p>\n Cell C bemoans lost revenue market share<\/strong><\/a><\/p>\n