Basic earnings per share will leap by more than 100% in the year to August, says alternative telecoms provider Vox Telecom.
Vox, which is in the process of being bought out by a consortium, says it expects to generate a basic profit per share, compared with a per share loss of 61.32c a year ago.
However, headline earnings per share, which strips out unusual items, will decline by least 19% from last year's 6.45c. JSE rules require companies to alert shareholders if their results will differ by more than 20%.
Vox says the increase in basic earnings is because last year's figures included impairments of goodwill and intangibles to the value of R512.6 million, which do not recur this year. The decline in headline earnings is due to loss of income on the back of lower interconnect rates.
Sharper focus
As a result of lower regulated interconnect rates, Vox is moving its least-cost routing (LCR) minutes to its Cristal Vox offering, which runs on its own network. Once Vox has moved its LCR customers over to Cristal, it will have higher margins, which will flow through to improved profitability.
The company said in the middle of July that it had received a R499 million buyout bid from a consortium comprising the Lereko Metier Capital Growth Fund and Investec Bank, which will see it de-listed on 29 November if the deal goes through.
Investec has increased its stake in Vox, buying shares at the buyout price of 45c, and now owns 17.61%. The consortium altogether now has a 42.45% stake, up from 42.06% before Investec's latest purchase.
Vox CEO Doug Reed said the main reason behind the buyout is because Vox has many businesses in the start-up phase. It is competing against other private companies and would benefit from being able to focus more on the business, without having the short-term pressure of reporting results every six months.
The company will provide more certainty on headline and earnings per share when it can quantify these figures.
Vox's shares closed unchanged yesterday at 45c.
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