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Econet swings to $106,4m loss after tax

by Staff reporter
02 Jul 2019 at 08:30hrs | Views
Econet Wireless Zimbabwe Limited (EWZL) posted a loss after-tax of ZWL$106,4 million in the year ended February 28, 2019, from a profit after-tax of ZWL$132,3 million recorded in 2018 following the unbundling of Cassava Smartech Zimbabwe Limited (CSZL).

Cassava demerged with effect from October 31, 2018 and took with it some of the subsidiaries that contributed significantly to Econet revenue's, which include EcoCash, EcoSure, Econet insurance, Steward Bank and Steward Health.

In the first six months of Econet's financial year ended August 2018, before the demerger, Cassava contributed 39% to EWZL's revenue.

This is the first loss after tax experienced by Econet since 2010.

In a statement accompanying the group's financial results, chairman James Myers said the results under review include CSZL's performance in eight months.

Total revenue for the period increased from ZWL$831,6 million recorded in 2018 to ZWL$1,1 billion.

Liabilities increased to ZWL$2,4 billion in 2019 from a comparative 2018 of ZWL$1,5 million.

Myers said capital investment during the period was restrained due to shortages of foreign currency.

"Capital investment in infrastructure development was subdued for the period under review due to limited access to foreign currency. This has a negative impact on our ability to sustain a comprehensive service offering as we transition to a digital economy," he said.

Dividends paid during the reviewed period amounted to ZWL$ 50 million.

EWZL continued to invest in renewable energy and a total of 116 solar-powered sites were commissioned during the period under review, reducing generator runtime, fuel consumption and related carbon dioxide emissions.

"Econet continues to pursue data revenue growth initiatives in response to the increased use of internet services, driven in part by growth in the adoption of smart phones by our customers, as the prices of these devices continue to fall. Strategic partnerships with key vendors remain a priority for the business," Myers said.

Myers said there is a strong demand for all its products and services.

"The group will continue to collaborate with smart technology businesses in Cassava SmarTech for separate value creation objectives while recognising and leveraging the synergies that have historically existed between the two separate entities," he said.

"We believe in a brighter future for Zimbabwe and will continue to strive for an inclusive and connected future that leaves no Zimbabwean behind. We believe in the strong future for the country and will continue to develop our business with a strong belief in Zimbabwe and its prospects."

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Source - newsday

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