Home > Business, Money Matters, Zimbabwe > Econet earnings rise by 20%

Econet earnings rise by 20%

HARARE- Zimbabwe’s biggest telecommunications firm Econet Wireless reported an 20 percent jump in full-year earnings, driven by subscriber growth following a $184 million investment to expand its mobile phone network.
Chief executive Douglas Mboweni said on Tuesday Econet was in negotiations with international banks for a $307 million loan to further expand the network, a sum that would also include the rolling over of some current credit lines.He did not give details, citing discussions with the financiers.Econet’s basic earnings per share rose to $1 in the year-ended February, from $0.83 the previous year.

Subscriber numbers grew 16 percent to 6.4 million in the year, driving revenue up to $611 million from $493.5 million previously.

After-tax profit was $165.7 million, up from $141 million for 2011.

Mboweni told an analysts’ briefing the firm had invested $184 million on expanding the network, bringing the total investment to $614 million in the three years since Zimbabwe dumped a local unit ravaged by hyperinflation for foreign currencies, mostly the U.S dollar.

The use of foreign currencies under a unity government set up by President Robert Mugabe and his rival, Prime Minister Morgan Tsvangirai, three years ago after disputed 2008 polls has stabilised the economy and helped lift some companies.

Mboweni said while there was still strong demand for voice and data offerings in Zimbabwe, Econet had diversified its revenue streams by introducing a mobile money transfer service which mainly targets people with no access to banking services.

Econet controls 70 percent of Zimbabwe’s mobile phone market and is in competition with VimpelCom’s local unit Telecel and state-owned NetOne.

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