The Directors of Telekom Networks Malawi Limited have released the Company’s annual report for the year ended 31 December 2012.
Below are extracts from the Chairman’s letter and financial highlights.
Moves to consolidate
In my report to shareholders last year I said that the medium term expectations over Malawi’s telecommunications growth potential were tempered by significant risks resulting from the economic climate prevailing in Malawi at that time. These potential risks crystallised in 2012 primarily in the form of currency depreciation and your Managing Director, Willem Swart and I now set out in our respective reports how this impacted our company.
In short, 2012 was a volatile year for our company. We experienced high revenue growth and rapid currency depreciation which more than doubled the cost of our capital expenditure programme and significantly increased finance charges on our largely foreign currency denominated debt. Without the re-engineering of most of our corporate practices over the past two years these negative effects would have been worse. Overall our profit after tax declined 49% to MK0.692bn on service revenue growth of 43%.
In response to these adverse conditions your management and Board have clearly set out a strategy whose main objective is significantly reducing the levels of debt we have, prudently managing our investment programme and operational expenditure to mitigate against further currency depreciation…
- 43% growth in Service Revenue to MK17.445bn
- 15% growth in EBITDA to MK5.407bn
- 3% growth in market share to 45%
- Decline in EBITDA margin to 30%
- 49% decline in profit after tax to MK0.692bn
Download full report on link below