Telkom earnings set to plummet

The group expects headline earnings per share to fall by at least 65% for the six months ended September 2012. By Duncan McLeod.

Added by Duncan McLeod on 20 September 2012.
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Telkom’s past indiscretions are coming back to haunt it. The JSE-listed telecommunications operator has warned shareholders that it expects headline earnings per share from continuing operations for the six months to 30 September 2012 to be at least 65% lower than the same period in 2011.

At the same time, basic earnings per share are expected to fall by at least 45%.

The group says the lower earnings are mainly attributable to an increase in the provision for the fine imposed on it by the competition commission for prior anticompetitive transgressions.

Last month, the Competition Tribunal fined Telkom R449m for abusing its monopoly between 1999 and 2004. Telkom has since said it will appeal against the decision. The Competition Commission, which referred the matter to the tribunal, has filed a cross-appeal seeking a larger fine than the one imposed.

“The operational performance for the period … has been further characterised by flat revenue and operating costs that escalated just below inflation,” it says.

Telkom says it will provide an updated trading statement once there is “reasonable certainty within a 20% range” of the expected numbers.

The group says it plans to release its interim results on or about 19 November.

Meanwhile, and in an unrelated development, Telkom says its company secretary, Mmathoto Lephadi, will step down at the end of the year.  — (c) 2012 NewsCentral Media

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