Professional Documents
Culture Documents
Half-Year Results
For The Period Ended 31 December, 2005 18 January, 2006
OPERATING ENVIRONMENT
Y-O-Y inflation rose from 132.70% in December 2004 to 585.8% by the end of December 2005. Foreign currency shortages and continued depreciation of the Zimbabwe dollar. Shortage of basic commodities, fuel and power cuts. Continued pressure on disposable income due to high inflation. Rising interest rates but with negative real returns.
Group Structure
100%
100%
84.3%
100%
35%
100%
TPS
FDM (YourFone)
Gulfsat Maghreb
Note: Kingdom Financial Holdings Ltd results have not been included.
KINGDOM FINANCIAL
HOLDINGS LIMITED
258,268 678,995
412,197 1,425,054
244,435 236,565
69% 502%
EBITDA Margin
Overheads as % of turnover PBIT margin Attributable earnings as % of turnover Basic EPS (Z$)
54%
32% 51% 47% 2,097.09
56%
29% 54% 42% 4,058.25 770,347 146,904 0%
53%
34% 53% 43% 658.97 132,015 65,504 0%
6%
15% 2% (2%) 516% 484% 124% 0%
Net cash generated from operations(Z$m) 306,237 Capex Debt Equity Ratio 136,964 0%
INCOME STATEMENT
ZW$ Millions June 2005 Dec - 2005 2004 change
Revenue Cost of sales & operating expenses EBITDA Depreciation and amortisation Net finance income
Minority interest
(55)
(706)
(70)
909%
Attributable earnings
317,616
604,947
101,161
498%
REVENUE GROWTH
Revenue has grown by 502%. Network upgrade resulted in release of over 156,000 new Libertie lines. Increased usage across all packages. Tariff increase awarded in October 2005 though below July 2005 tariff.
1,600 1,400 1,200 1,000 800 600 400 200 200 0 237 679
1,425
2004 Jun
2004 Dec
2005 Jun
2005 Dec
Revenue
REVENUE CONTRIBUTION
By Company
Dec - 2005
$1,4 trillion
FDM 1% TPS 1%
FDM 4%
Dec- 2004
$237 billion
Data Control 3%
Data Control 3%
TPS 1%
EWZ 94%
EWZ 92%
REVENUE ANALYSIS
Dec-2005
$1.4 trillion
International
10%
Dec - 2004
$237 billion
International
9%
Other
8%
9%
8% Other
Interconnection
Interconnection
20%
Local airtime
61%
73%
Local airtime
EBITDA GROWTH
900 800 52% 700 600 34% 52% 50%
797
53%
54%
56%
60%
50%
40%
Billions
500 30% 400 300 369 200 10% 100 2 0 2002 Jun 2003 Jun 2003 Dec 13 31 100 2004 Jun 2004 Dec 2005 Jun 2005 Dec 124 0% 20%
EBIDTA
Margin
PROFIT GROWTH
800
491%
869
600
Billions
605
400
499%
467 318 147
200
104 76 101
2004 Jun
2004 Dec
2005 Jun
2005 Dec
PBT
PAT
BALANCE SHEET
ZW$ Millions Jun-2005 Dec - 2005 Dec - 2004 change
TOTAL EQUITY AND LIABILITIES 577,422 Total Equity Current Liabilities Non Current Liabilities 333,642 239,377 4,403
CASHFLOW STATEMENT
ZW$ Millions
Jun 2005
Dec 2005
Dec 2004
Change
Cash flow from operating activities Net finance income Taxation paid Dividend paid Net cash flow from operating activities
Cash flow from investing activities Cash flow from financing activities
904,242 133,172 579% 101,808 17,332 487% (163,602) (5,729) 2,999% (72,101) (13,703) 426% 770,347 131,072 488%
111% 625%
39,071 1,026%
43,347
179,353
179,353
619,450
43,347
82,419
314%
652%
OPERATIONAL PERFORMANCE
Douglas Mboweni
OPERATIONAL PRIORITIES
Grow an active & viable subscriber base and sustain economic Tariffs in real terms
NETWORK DEVELOPMENT
Upgrade of critical switch hardware and software. Continue with implementation and commissioning of Base stations Implementation of GSM 1800 Implementation of 2.5G & 3G functionality Key focus is on Network quality and subscriber uptake.
RADIO NETWORK
THREE
RADIO NETWORK
NETWORK COVERAGE
New geographical coverage: Zvishavane, Shurugwi, Mt Darwin, Mvurwi, Macheke, Banket, Rutenga, Mvuma, Shangani, & Mazowe, Chirundu, Kariba Harbour, Nyazura, & Esigodini Towers and shelters have been erected in nearly all small towns, holiday resorts, growth points, business centers and border posts
MARKET SHARES
All Networks Mobile Networks
Tel*One 32%
Econet 38%
Telecel 19%
Telecel 13%
Net*One 25%
Net*One 17%
Econet 56%
Market Intelligence
1
2
3
4 5
Introduction of airtime sales and bill payment in all Kingdom Bank branches
3.
4.
5.
Payphones.
1,000 2,000 3,000 4,000 5,000 6,000 -
PAYPHONES
Payphone Growth
Month
Additons
Cumulative
SUBSCRIBER GROWTH Subscribers increased by 69% with an addition of 167,762 new lines since 31 December 2004. Total subscribers now at 412,197 (244,435 at 31 Dec 2004) Re-launch of Libertie added over 156,000 new lines. The business focus will be on new Libertie in the second half.
450000 400000 350000 300000
35 2, 37 6 11 4, 25 2 73 ,9 55 17 0, 48 0 19 3, 80 9
69%
2003 Dec
2004 Dec
2005 Jun
64 ,4 59
2005 Dec
Contract
Prepaid
59 ,8 21
161
2003 Dec
2004 Dec
2004 Jun
2004 Dec
2005 Jun
2005 Dec
Outgoing
Incoming
70,000,000 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 Mar05 Apr05 May- Jun05 05 Jul05 Aug- Sep05 05 Oct05 Nov- Dec05 05
Outgoing Minutes
Incoming Minutes
INCOMING MINUTES
70,000,000 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 Mar05 Apr05 May- Jun05 05 Jul05 Aug- Sep05 05 Oct05 Nov- Dec05 05
COSITU Benefits Cost Based Model captures all cost elements and allows the business to charge economic tariffs Easier to establish rapport with the Regulator, with the use of COSITU.
The Future Agreed with Regulator to review tariffs every quarter Operators are allowed to review tariffs whenever there is a significant shift in the cost structure Operators required to be cost-efficient to avoid over-pricing
STAFF PRODUCTIVITY AND RETENTION 1. The company has moved to a Performance bonus based on company profitability and cost efficiency. This replaces the traditional thirteenth cheque which had no bearing on profitability. 2. The company has a staff training and development programme named Grow and Glow. Retention of skilled staff is a key business priority. 3. The business continues to deal with the HIV/AIDS challenge by promoting an employee wellness programme Live to Love aimed at: a) Awareness b) Prevention and c) Treatment.
1. Econet launched Econet in the Community programme in September 2004 with the target being the less privileged in the society. A number of organisations such as Jairos Jiri continue benefited from the programme.
2. Econet supports the education and upkeep of more than 25,000 orphans through Capernaum Trust.
3. The Company has launched the Joshua Nkomo Scholarship Fund which will take care of University tuition fees and stipend for the top 5 students from each of the 10 provinces in Zimbabwe.
THANK YOU