Econet profit up in Zimdollars, down in US dollars

Econet Wireless, Zimbabwe’s largest mobile phone operator, continued to perform beyond expectations with net profit increasing more than four-fold from $76.5 billion in the first half of last year to $317.6 billion this year.

It, however, had a lacklustre performance in US dollar terms with profit declining from US$14.1 million to US$8.7 million.

According to its results for the six months to June, revenue shot up from $200 billion to $679 billion with profit from operations increasing from $98.9 billion to $360.4 billion.

Revenue was also up in US dollar terms, increasing from US$80.7 million to US$108.6 million.

Operating profit stood at US$49 million, up from US$30.6 billion. Profit after tax was, however, down to US$5.2 million from US$10.7 million after the company paid tax of US$15.8 million compared to US$9.7 million the previous year.

Net profit rose to US$8.7 million because of equity earnings amounting to US$3.4 million which was almost the same figure as the previous year.

The company, which has been embroiled in a legal wrangle with Johannesburg Stock Exchange listed Altech Holdings over ownership of its global operations after a joint venture between the two companies went sour, says its subscription base increased by 49 percent from 173 606 to 258 268 this year. The number of payphone operators shot up from 400 to 4 300.

Its biggest headache, it says, are the low tariffs especially in Zimbabwe as they continue to lag behind those in the region and world. But it remains committed to improving its service delivery and expanding its subscriber base.

The company which was sitting on $179.4 billion cash at the end of June is currently debt free and says it will continue to pursue its “zero debt policy” because of the “prevailing unstable macro-economic environment”.

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