Botswana Telecommunications Corporation Limited
ABRIDGED UNAUDITED FINANCIAL RESULTS FOR THE HALF YEAR ENDED 30 SEPTEMBER 2022
The Board and Management of Botswana Telecommunications Corporation Limited ('BTC') are pleased to present to shareholders the abridged unaudited financial results of the Company for the half year ended 30 September 2022.
Revenue | Profit for the Period | Earnings per share |
P691 million | P22 million | 2.11 thebe |
STATEMENT OF CASH FLOWS
For the six months ended 30 September 2022 | Unaudited | Unaudited | Audited |
6 Months | 6 Months | 12 Months | |
to 30.09.2022 | to 30.09.2021 | to 31.03.2022 | |
P '000 | P '000 | P '000 |
Dividend
Given the current circumstances, the Board decided not to declare a dividend for this period.
Total Assets | EDITDA Margin |
P3.02 billion | 21% |
CASH FLOWS FROM OPERATING ACTIVITIES Operating cash flow before working capital changes Working capital adjustments:
Increase in inventories
Decrease/(Increase) in trade and other receivables, contract assets and prepayments
215,260 | 227,204 | 439,539 |
(13,177) | (7,244) | (8,197) |
15,291 | (1,585) | 5,001 |
For and on behalf of the Board of Directors
COMMENTARY
Our Business
Botswana Telecommunications Corporation is a converged telecommunications operator offering fixed (voice and data), mobile (voice and data) and broadband services to consumers, enterprise and other licensed service providers.
Half year performance in numbers
- Revenue P691 million
- EBITDA margin 21%
- Profit after tax P22 million
- Earnings per share 2.11 thebe
- Cash Conversion at 67%
Review of Results
The interim Financial Statements of the company for the six months' period ended 30 September 2022 were authorised for issue by the Board of Directors on 14 December 2022.
Performance Overview
For the six months under review, the Company performance was subdued due to difficult macro-economic conditions. Performance was further depressed by the once off provision for restructuring costs and an escalation in replacement costs for stolen copper from our network.
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Unaudited | Unaudited | Audited | |
For the six months ended 30 September 2022 | 6 Months | 6 Months | 12 Months |
to 30.09.2022 | to 30.09.2021 | to 31.03.2022 | |
P '000 | P '000 | P '000 | |
Revenue from contracts with customers | 691,206 | 698,363 | 1,392,257 |
Cost of services and goods sold* | (290,516) | (294,995) | (604,751) |
Gross profit | |||
400,690 | 403,368 | 787,506 | |
Interest income | 23,685 | 9,334 | 18,796 |
Interest expense | (9,899) | (11,901) | (22,767) |
Other income | 2,581 | 24,986 | 39,918 |
Selling and distribution costs | (11,764) | (9,586) | (18,242) |
Administrative expenses** | (260,766) | (198,615) | (403,573) |
Impairment losses and gains on financial | (2,353) | (10,390) | 3,191 |
assets and contract assets | (116,848) | (107,485) | (222,436) |
Other expenses | |||
Profit before tax | |||
25,326 | 99,711 | 182,393 | |
Income tax expense | (3,135) | (13,766) | (41,608) |
Profit for the period | |||
22,191 | 85,945 | 140,785 | |
Other comprehensive income for the period | - | - | (6,054) |
Increase in trade and other payables and contract liabilities Cash generated from operations
Ordinary dividend paid to shareholders Income tax paid
Net cash from operating activities
CASH FLOWS USED IN INVESTING ACTIVITIES:
Investment to expand operations:
Purchase of property, plant and equipment Purchase of intangible assets
Proceeds from disposal of property, plant and equipment Interest income received
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Grants received
Interest paid on lease liabilities and IRU liability Principal payment of lease liabilities Principal payment of IRU liability
Net cash from financing activities
Increase in cash and cash equivalents
Net foreign exchange difference on cash and cash equivalents Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the period
11,557 | 9,959 | 22,023 |
228,931 | 228,334 | 458,366 |
(51,906) | (54,903) | (92,676) |
(1,034) | 1,265 | (169) |
175,991 | 174,696 | 365,521 |
(73,431) | (24,058) | (113,050) |
(13,977) | (17,185) | (20,903) |
27,099 | 184 | 387 |
23,685 | 5,954 | 18,796 |
(36,624) | (35,105) | (114,770) |
4,740 | - | 3,465 |
(10,123) | (12,151) | (23,130) |
(8,405) | (8,251) | (17,125) |
(29,323) | (27,465) | (55,946) |
(43,111) | (47,867) | (92,736) |
96,256 | 91,724 | 158,015 |
(743) | 9,642 | (846) |
520,442 | 363,273 | 363,273 |
615,955 | 464,639 | 520,442 |
Lorato Boakgomo-Ntakhwana | Anthony Masunga | |
Chairperson | Managing Director |
Board of Directors
Lorato Boakgomo-Ntakhwana (Chairperson), Anthony Masunga (Managing Director), Maclean Letshwiti, Andrew Johnson*, Ranjith Priyalal De Silva**, Thari Pheko, Bafana Molomo and Thato Kewakae.
*South African **Sri Lankan
Company Secretary
Sidney Mganga
Company Number
BW00000748937
Transfer Secretaries
Central Securities Depository Company of Botswana
Plot 70667, Fairscape Precinct. 4th Floor, Fairgrounds, Gaborone Private Bag 00417, Gaborone
Contact Details: 3674400/ 09/11/12
Contact Person: Nonofo Phalatse or Ambrosia Khupe
The Company recorded revenue of P691 million during the period under review. Data services and mobile financial services revenue growth momentum continued but was partially offset by the decline in performance of voice services. The cost of sales reduced by only 2% (normalised basis 11%) thus leading to gross profit being level with the prior year. The total impact of copper cable theft amounted to P29 million. The Company has since intensified efforts and increased its capital budget towards building alternative technologies to replace the copper network investments. The once off provision of P67 million for the organisational restructuring drove the increase in the operating expenditure. The primary objectives of the organisational restructuring include the creation of a more fit-for-purpose organisation that supports the strategic repositioning of the business into the future. Furthermore, the exercise ensures that the Company has the right human capital in the right jobs that will contribute towards
Total comprehensive income for the period | 22,191 | 85,945 | 134,731 |
Basic and diluted earnings per share (thebe): | 2.11 | 8.19 | 13.41 |
*Cost of sales include P29 million related to copper cable theft | |||
**Administrative expenses include cost of resource optimization of P67 million | |||
STATEMENT OF FINANCIAL POSITION | |||
Unaudited | Unaudited | Audited | |
As at 30 September 2022 | Sep 2022 | Sep 2021 | Mar 2022 |
P '000 | P '000 | P '000 |
STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 September 2022 | Stated | Revaluation | Accumulated | Total |
Capital | Reserve | Profits | ||
P '000 | P '000 | P '000 | P '000 | |
Balance at 1 April 2021 (Restated) | 478,892 | 382,363 | 1,379,999 | 2,241,254 |
Profit for the six months period | - | - | 85,945 | 85,945 |
Total Comprehensive Income | ||||
- | - | 85,945 | 85,945 |
Auditor
Deloitte & Touche
Plot 64518 Fairgrounds
P O Box 778 Gaborone, Botswana
Megaleng House
Plot 50350, Khama Crescent
P.O. Box 700 Gaborone, Botswana
the future viability and long-term financial sustainability of the Company.
The pressure on costs as highlighted above led to EBITDA declining by 13% to P144 million.
The Company delivered healthy cash and cash equivalents that resulted in an increase of P96 million reflecting a 67% cash conversion.
Domestic Economy
The domestic economy is forecasted to grow by about 4% in 2022, with the increase in economic activity following the relaxation of COVID-19 protocols, a successful vaccination rollout programme and the implementation of the Government's Economic Recovery and Transformation Plan (ERTP) and the national Reset Agenda.
Inflation is expected to continue to be above the central bank target of 3-6% due to rising prices of goods and services especially food and fuel prices. This in turn is expected to negatively impact spending power of Government, enterprises and households.
Outlook
Despite the uncertainty of the economy, BTC will intensify the efforts to improve its financial and operational performance by seizing the available opportunities in the market. Going forward, the company will continue to drive data and value offers in the market as we accommodate the shifts in demand and usage patterns (i.e., from voice to data driven services). We will continue to migrate customers off legacy technologies so that they can experience faster and more reliable fixed and mobile data. We are determined to improve localities and communities through our network and services that we offer. The infrastructure that BTC has invested on from mobile, fixed, VSAT to data centre is a great foundation for driving digital services, cloud services and fintech services. The company will continue to pursue its digital transformation program and create more value for our customers through our services and innovative solutions. BTC is focusing on driving its customers to use more of our digital platforms for convenience and the ability to get our services and offers anywhere and anytime.
The company will further drive its efficiency improvement program as way of optimising our cost structure and responding to changing market dynamics.
Efforts to build a digital culture and strengthen our human capital will continue to position our company to be more responsive to the fast-changing market landscape.
ASSETS
Non-current assets
Property, plant and equipment
Right of use assets
Intangible assets
IRU asset
Current assets
Inventories
Trade and other receivables
Contract assets
Income tax receivable
Cash and cash equivalents
Assets held for sale
TOTAL ASSETS
EQUITY AND LIABILITIES
Capital and Reserves
Stated capital
Revaluation reserve
Accumulated profits
Non - Current Liabilities
Development grants
Lease liabilities
IRU liability
Deferred tax liability
Employee related provisions
Current Liabilities
Trade and other payables Contract liabilities Deferred tax liability Lease liabilities
Current portion of development grants Current portion of employee related provisions
TOTAL EQUITY AND LIABILITIES
1,436,431 | 1,453,748 | 1,449,452 |
178,566 | 200,435 | 183,946 |
112,998 | 120,580 | 115,337 |
401,200 | 439,409 | 420,305 |
2,129,195 | 2,214,172 | 2,169,040 |
66,596 | 52,466 | 53,419 |
146,859 | 143,710 | 161,122 |
49,204 | 45,154 | 53,539 |
1,844 | - | 810 |
615,955 | 464,639 | 520,442 |
880,458 | 705,969 | 789,332 |
7,503 | 39,983 | 32,222 |
887,961 | 745,952 | 821,554 |
3,017,156 | 2,960,124 | 2,990,594 |
478,892 | 478,892 | 478,892 |
352,951 | 373,939 | 361,375 |
1,419,123 | 1,418,613 | 1,441,428 |
2,250,966 | 2,271,444 | 2,281,695 |
12,507 | 6,281 | 8,543 |
113,172 | 119,597 | 115,753 |
97,711 | 151,099 | 120,590 |
58,775 | 29,505 | 55,640 |
8,731 | 9,736 | 7,994 |
290,896 | 316,218 | 308,520 |
290,825 | 248,290 | 279,765 |
12,198 | 16,348 | 13,522 |
18,755 | 16,383 | 16,718 |
53,388 | 58,113 | 60,022 |
860 | 5,735 | 860 |
99,268 | 27,593 | 29,492 |
475,294 | 372,462 | 400,379 |
3,017,156 | 2,960,124 | 2,990,594 |
Ordinary dividend declared | - | - | (55,755) | (55,755) |
Depreciation transfer for land and buildings | - | (8,424) | 8,424 | - |
Balance at 30 September 2021 (Unaudited) | ||||
478,892 | 373,939 | 1,418,613 | 2,271,444 | |
Profit for the rest of the year | - | - | 54,840 | 54,840 |
Other comprehensive income | - | (6,054) | - | (6,054) |
Total Comprehensive Income | ||||
- | (6,054) | 54,840 | 48,786 | |
Ordinary dividend declared | - | - | (38,535) | (38,535) |
Depreciation transfer for land and buildings | - | (6,510) | 6,510 | - |
Balance at 31 March 2022 (Audited) | ||||
478,892 | 361,375 | 1,441,428 | 2,281,695 | |
Profit for the six months period | - | - | 22,191 | 22,191 |
Total Comprehensive Income | ||||
- | - | 22,191 | 22,191 | |
Ordinary dividend declared | - | - | (52,920) | (52,920) |
Depreciation transfer for land and buildings | - | (8,424) | 8,424 | - |
Balance at 30 September 2022 (Unaudited) | 478,892 | 352,951 | 1,419,123 | 2,250,966 |
Presentation of Unaudited Interim Financial Statements
The interim Financial Statements are presented in Botswana Pula which is the Company's functional currency.
Basis of Preparation and Accounting Policies
The interim financial statements have been prepared on a historical cost basis, except as modified by the revaluation of certain fixed assets and on the going concern basis.
The accounting policies adopted for the period comply in all material respects with International Financial Reporting Standards (''IFRS'') issued by the International Accounting Standards Board (''IASB''), interpretations issued by the International Financial Reporting Standards Interpretations Committee and in the manner required by the Companies Act of Botswana (CAP 42:01). These policies are consistent with those applied for the year ended 31 March 2022.
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Disclaimer
BTC - Botswana Telecommunications Corporation Ltd. published this content on 20 December 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 December 2022 10:56:09 UTC.