Telkom replaces board members
JSE-listed fixed-line operator Telkom says its board now has enough directors to appoint a new chairman to replace Lazarus Zim, after it elected two new non-executive directors.
Telkom appointed Jabulane Albert Mabuza and Kholeka Mzondeki. As the board now has eight members, it can vote on a new chairman to replace Zim, who recently stepped down. Telkom recently lost non-executive directors after the Department of Communications voted against the re-election of four Telkom directors.
Outgoing CEO Nombulelo "Pinky" Moholi said: "We welcome the appointment of our new board members and believe that their depth of knowledge, skill and experience will be of great value to Telkom.
"While these are challenging times for the company and its people, I am convinced that Telkom will emerge strengthened and able to continue to contribute to the economic growth of the country," adds Moholi.
Telkom recently lost several top executives, including Moholi, non-executive director Neo Phakama Dongwana, and Deon Liebenberg, who was managing executive of Telkom Business Mobile.
Mabuza serves as deputy chairman of Tsogo Sun Holdings and serves on the boards of Ampleray Investments, Eglin Investments No. 44, Hydrop Investments, Kuncedzana Investments Holdings, Lexshell 627 Investments and other boards. Mzondeki, a CA, also sits on the Reunert, Sentula Mining and Bauba Platinum boards.
Telkom this morning also published a fresh update on its trading expectations for the six months to September. It said headline earnings per share from continuing operations are expected to be between 78% and 83% lower than the first half of last year.
Telkom added that basic earnings per share from continuing operations are likely to come in between 62% and 67% lower. In September, the group said basic earnings per share from continuing operations would be at least 45% lower, while headline earnings per share from continuing operations would drop 56%.
For the six months to September 2011, the group reported operating revenue down 3.2%, to R16.4 billion, and higher operating expenditure of R15.4 billion, mostly due to its impairment of iWayAfrica, higher depreciation and costs relating to its mobile arm, 8ta.
Last year, headline earnings per share from continuing operations for the first six months came in at 297c, while basic earnings per share from continuing operations were 291.5c.
Telkom said the lower earnings for the six months to September are mainly the result of an "increase in the provision" for the Competition Tribunal fine of R449 million for "transgressions of the company dating back approximately 10 years".
The tribunal fined Telkom for abusing its monopoly between 1999 and 2004, in what was the first competition decision to be handed down against the telecoms group.