On the 29th of June 2018 TelOne held its fourth successive AGM where the 2017 audited financial results were adopted as part of its strengthened good corporate governance. The results reveal that the company recorded a 3% increase in total revenue in the year 2017 owing to an upsurge in broadband revenues. The Growth in broadband drove the overall revenue performance at TelOne, with revenue growing from $114 million in the year 2016 to $117 million in the year 2017.
Broadband revenue grew by 36% and reached $45 million in 2017 as compared to $33 million the previous year. The company’s subscriber base grew from 80 745 subscribers in 2016 to 87 851 subscribers in 2017 marking an increase of 8,8%. The company’s profitability at EBITDA level improved by 43% growing from $14 million to $20 million, driven by cost containment and broadband growth. The company also managed to reduce operating losses (Earnings Before Interest and Tax) by 42% from $12 million in 2016 to $7 million in 2017. In line with worldwide trend of voice decline. TelOne voice traffic in the year 2017 declined by 6%, subsequently voice revenues recorded a 9% decline.
2017 was largely a capitalisation year were TelOne implemented a huge chunk of its $98 million National Broadband Project (NBB) which is now complete. This investment was largely focused on expanding the backbone footprint, increasing the core network capacity as well as fortifying the network which was largely legacy. The project has started bearing fruits with revenue increases being recorded in the first year of capitalisation.
In addition TelOne also realised a significant uplift in assets from $490 million in 2016 to $548 million due to network investments made as part of the NBB project. Speaking at the TelOne Annual General Meeting today, TelOne Board Chair, Mrs Juliet Machoba, said the company expects broadband revenue contribution to continue in an upward trend and reach up to 50% by 2019. “In line with worldwide trends, voice traffic is expected to continue in a downward trend as clients continue to opt for broadband internet and Over The Top Services (OTTS). Voice revenue in TelOne is expected to reduce to less than 40% in 2019 while broadband contribution to revenue is expected to reach up to 50% in the same period,” said Mrs Machoba.
The company has already started a drive towards enhancing its Value Added Service offering as a way of harnessing the potential revenues brought about by increased broadband capacity and subscribers. TelOne notes that the legacy loans continue to weigh down the balance sheet and is expecting a conclusion of the debt restructuring to ease the company’s profit and loss position. The unavailability of foreign currency remains a major constraint to TelOne, with foreign obligations rising to unsustainable levels. TelOne operations, including bandwidth importation are dependent on foreign partners. However the recent announcement by Government on the part privatisation of TelOne is also expected to bring in new opportunities for growth and partnerships. TelOne looks forward to further revenue growth for enhanced profitability.