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Cell C surpasses Knott-Craig's targets

Bonnie Tubbs
By Bonnie Tubbs
Johannesburg, 25 Jul 2014
This time last year then CEO of Cell C Alan Knott-Craig said he wanted 20% market share by the end of 2017.
This time last year then CEO of Cell C Alan Knott-Craig said he wanted 20% market share by the end of 2017.

SA's third mobile operator Cell C has surpassed former CEO Alan Knott-Craig's subscriber goal, with its customer base reaching 18.1 million - a 59% escalation since a year ago.

The operator made the announcement in a statement today, but did not give a break-down in terms of prepaid, contract, M2M and data SIMs.

Last July, Knott-Craig said he wanted the company to grow to 14 million subscribers by the end of 2014. At the time he said Cell C was operating in a saturated market and that the only way to grow would be by taking customers away from other operators.

Knott Craig said he wanted 20% market share by the end of 2017 - an ambition that has not only been met, but - according to a spreadsheet developed by BMI-TechKnowledge director Brian Neilson - exceeded by 3%, three years earlier than planned.

Around this time last year, Cell C also trumpeted what it felt was a historical achievement - the signing up of over a million customers in one month.

"Last night, we broke through the million gross connection barrier, bringing our total customer base to over 11.7 million," said Knott-Craig on 30 July 2013.

Out of the one million new sign-ups, however, 662 000 had churned away from the network - so net additions were just 338 000. Knott-Craig said, despite the high churn, he was encouraged by the company's steady growth.

Debt extension

In the same breath, Cell C announced it would extend the maturity date of EUR160m (about R2.3 billion) of senior debt.

"As a part of the transaction, Cell C has offered to buy back debt from any bond holder who does not wish to extend. The expected extension is further confirmation of the confidence that funders have in the future of Cell C and will enable Cell C to continue to invest heavily in its network infrastructure in support of its business plan."

Cell C CEO Jose Dos Santos says the extension will allow it to channel equity and cash generated in the business to increase its capacity to continue to grow the company.

Reuters reported earlier today that Cell C was looking to restructure EUR77.4 million (about R1.1 billion) worth of senior debt in a bid to improve its cash management.

Announcing a new 50c per minute prepaid promotion, Dos Santos yesterday vowed that Cell C would continue to champion the cause of consumers.