TNM, a leading Malawi mobile operator, has forecast Malawi’s Penetration Rate to extend past 40% in coming years. This was outlined in the announcement below, the full text of which may be obtained from their website. Handset subsidies are the key driver to this growth. TNM has lifted its market share from 33% to 37% for the period ended 31 December 2010 and the fact that the results are published before the end of February in Malawi is very notable. Well done to the team at TNM. Another positive is the continued investment by the company into infrastructure.
Herewith a few extracts (please refer to the website for the full announcement):-
Key achievements in 2010
- Increase of market share to 37% from 33%
- Commissioned a new prepaid billing platform to support dynamic product offerings
- More than 70 new base stations constructed
- Affordable voice and data prepaid tariff bundles launched
- New billing system commissioned for post paid service
Key financial highlights
- 21% growth in revenues to MK9.930bn
- 25% increase in EBITDA to MK3.647bn
- EBITDA margin 37%
- Capex additions MK5.685bn
- Shareholders’ funds MK7.276bn
- Earnings per share MK0.11
Review of the year
TNM is pleased to again announce good results for 2010 with high growth in Revenue and EBITDA, which was achieved as a result of the aggressive investment in infrastructure and related marketing activities. The substantial investment made in the last few years (MK4.538bn in 2009) has however increased the depreciation charge by MK571million on the enhanced fixed asset base. The high levels of investment have substantially increased the levels of short term debt which resulted in an increase in borrowing costs by MK273million. As a result of the increases in depreciation and financing costs the net profit declined from MK1.215bn to MK1.060bn in 2010…
Outlook
The results achieved in 2010 put the company in a strong position to consolidate the gains made in the past years, to increase its position in the market and serve the customers better in line with our mission statement. The Board and management of TNM foresee the penetration level of the country further increasing beyond 40% in the next few years. The higher levels of subsidy on handsets will play a pivotal role in allowing customers to access mobile telephony services…..
Dividends
Total dividends of MK 602.4 million (MK0.06 per share) will be declared and paid for the period ending 31 December 2010 as follows:-
| MK 200.8 million | 2t per share was declared and paid in October 2010 |
| MK 200.8 million | 2t per share was declared in December 2010 was paid in January 2011. |
| MK 200.8 million | 2t to be declared at the upcoming AGM* |
*The directors propose a final dividend of 2 tambala per share out of the profits of the company for the year ended 31 December 2010 for declaration at the forthcoming annual general meeting.
