Telecommunications group Telkom is expecting a jump in its earnings in the upcoming annual results for the year ended 31 March (FY2024).
The JSE-listed company today published a trading update ahead of its annual results, scheduled for Tuesday, 18 June.
The group anticipates reporting improved financial results for FY2024, despite challenging economic and trading environments.
It notes that stronger operational performance driven by continued demand for the company’s next-generation technologies, along with cost-optimisation initiatives, contributed to improved earnings.
Telkom informs its shareholders that reported basic earnings per share (BEPS) and headline earnings per share (HEPS) for the year are expected to increase by more than 20% when compared to BEPS and the restated HEPS for the year ended 31 March 2023 (FY2023).
It adds that next-generation revenue grew by approximately 7%, and now comprises almost 80% of total group revenue.
Reported earnings before interest, taxes, depreciation and amortisation (EBITDA) grew by approximately 18%, while normalised EBITDA grew in line with guidance at approximately 5%.
Telkom points out that growth in earnings has also been positively impacted by lower depreciation and write-offs in FY2024 after asset impairments recognised in FY2023.
This growth was partially offset by higher net finance charges and foreign exchange and fair value movements in FY2024, it explains.
Total depreciation and amortisation for property, plant and equipment and intangible assets decreased by approximately 23% from R7.145 billion in the prior year.
“Write-offs of property, plant and equipment and intangible assets reduced to approximately R80 million from R13 508 million write-offs and impairments of property, plant and equipment and intangible assets in the prior year; and net finance charges and fair value movements increased by approximately 47% from R1.485 billion in the prior year, largely due to higher lending rates during the year,” says the company.
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