Econet half year net profit halved to $23 million

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ZIMBABWE’S largest mobile phone operator Econet Wireless has more than halved its after tax profit for the six months to August to US$23,4 million from US$49,6 million recorded in prior comparative period on declining revenue and rising finance costs, signaling a weakening economy.

At US$323 million, revenue was down 17,7% despite growth in the company’s subscriber base, indicating weakening aggregate demand in the economy. Subscribers grew by 1,8% to 9 186 871.

ECONET

Overlay services revenue grew by 29% to US$35,5 million driven by the group’s banking unit, Steward Bank while mobile broadband data revenue decreased to $52,3 million from $55,9 million.

Finance costs rose to US$21 million from US$17 million.

Basic earnings per share also declined to 1,5 cents from 3,2 cents.

Last week, Econet announced plans to lay off 100 workers after it emerged that repayment of a debt incurred after the renewal of an operating licence two years ago and new statutory obligations was hurting the company.

Econet is the third largest counter on the Zimbabwe Stock Exchange by market capitalisation after Delta and Innscor.-Bernard Mpofu

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