Telkom South Africa Says Profit Slumped, Names New Board Members
Telkom SA Ltd. (TKG), Africa’s largest fixed-line operator, said first-half earnings slumped by as much as 83 percent and appointed two new non-executive directors to reach the minimum number required by regulators.
The company named Jabulane Albert Mabuza, the deputy chairman of entertainment group Tsogo Sun Holdings Ltd., and Kholeka Mzondeki, a former chief financial officer of Masana Petroleum Solutions Pty Ltd., to the board, it said in a statement today.
Their arrival takes the number of board members to the required eight and will allow the company to step up a search for a new chairman and chief executive officer after both resigned over the course of the past month, Telkom said.
Adjusted earnings per share fell between 78 percent and 83 percent in the six months ended Sept. 30, the company said in a separate statement today. Telkom has been struggling to compete with mobile operators as more consumers use mobile phones for voice as well as data services including broadband.
Telkom has asked the South African government, its largest shareholder, to approve the sale of part of the business as it seeks to expand into higher-margin broadband and mobile markets. The government blocked the sale of a 20 percent stake to South Korea’s KT Corp. this year, saying it was a strategic asset to the country.
Telkom shares were up 0.3 percent to 16.55 rand at 10:02 a.m. in Johannesburg, after having declined as much as 1.9 percent earlier. They are down about 43 percent in the year to date, compared with a 17 percent rise in the FTSE/JSE Africa All Share Index.
Telkom expects to report interim results for the period on about Nov. 19.
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