Blu Label Unlimited expects earnings per share (EPS), headline earnings per share (HEPS) and core HEPS to fall by more than 20% for the year ended 31 May, as accounting effects linked to the restructuring and listing of Cell C weigh heavily on its reported results.
In a trading statement released ahead of its full-year results, Blu says reported EPS is expected to decline by more than 100%, from 276.52 cents a share in the previous financial year, to between 542.50 cents and 536.96 cents per share.
HEPS is expected to fall by between 81% and 83%, from 455.96 cents, to between 79.02 cents and 88.14 cents a share.
Core HEPS is forecast to decline by between 80% and 82%, from 461.63 cents, to between 83.58 cents and 92.82 cents a share.
Blu says the sharp deterioration is largely attributable to non-operational accounting effects arising from the Cell C restructuring transactions and the outcome of the mobile operator’s listing.
“As previously reported in Blu Label’s interim results for the six-month period ended 30 November 2025, shareholders were advised that the non-operational accounting effects arising from the Cell C restructuring transactions and outcome of the listing would continue to affect reported earnings for the full financial year ending 31 May 2026,” the company says.
It adds that its reported results for both the latest reporting period and comparative period were “materially impacted” by the Cell C restructuring transactions, the listing of Cell C and the resulting accounting consequences under IFRS Accounting Standards.
“These factors resulted in a material decline in reported EPS, HEPS and core HEPS for the reporting period,” Blu Label says.
However, the company sought to distinguish the accounting impact from the underlying performance of its operations.
Excluding Cell C and Comm Equipment Company’s financial results, as well as items related to the restructuring transactions and Cell C listing, losses on disposals and impairments, Blu Label notes that it would have reported revenue of R9.4 billion for the year.
On the same basis, gross income would have been R2.5 billion, EBITDA R923 million and net profit after tax R677 million.
Core headline earnings would have amounted to R681 million, translating into core HEPS of 75.33 cents.
The firm says these figures provide “a more meaningful indication of Blu’s underlying operational performance and earnings base going forward”.
The company also highlights the scale of its underlying transactional business, noting that its reported revenue does not include the full value of certain products because only the gross profit is recognised as revenue.
These products include PINless top-ups, prepaid electricity, ticketing and universal vouchers.
The imputed gross revenue generated from these sources amounted to R99.9 billion during the reporting period, according to Blu Label.
The significant decline in reported earnings comes as Blu Label continues to account for the complex restructuring of Cell C, in which it has held a major strategic interest.
The company had previously warned shareholders that the accounting consequences of the transactions would continue to affect its financial statements beyond the interim reporting period.
Blu Label’s trading statement is based on preliminary financial information that has not been reviewed or audited by its external auditors.
The company will publish its full financial results for the year ended 31 May on 26 August.
Meanwhile, Cell C’s full year results for the 12 months ended May are expected to be published next week on 21 August.
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