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TNM FY 2013 results
 

TNM FY 2013 results

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TNM FY 2013 results

TNM FY 2013 results

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    TNM FY 2013 results TNM FY 2013 results Document Transcript

    • Using technology to build the future KEY ACHIEVEMENTS IN 2013 12% GROWTHin subscriber base MPAMBAtnm mobile money launch IMPROVEMENTin general network quality MOYO COVERfree tnm life insurance launch Results for the year ended 31 December 2013 REVIEW OF THE YEAR The company achieved high levels of Revenue growth during 2013 and the profitability recovered to the levels as experienced before the devaluation of the Malawi Kwacha in 2012. The liberalisation of the Malawi Kwacha foreign exchange rate policy, improved the availability of foreign exchange in the market and TNM was able to decrease the exposure of the business to foreign exchange accounting losses. The impact of the exchange rate however, resulted in significant increases in most of the operating expenditure areas and the cost of new Infrastructure investment, which are mainly denominated in foreign currencies. The company was successful in the efforts to be more efficient in all the expenditure areas and it resulted, together with the actions taken to improve the Revenue streams, in the improvement of the EBITDA margin to 35% in 2013 from 30% in 2012. The high interest rate environment in Malawi during 2013 had a significant impact on the financial results. The Net Financing Cost increased to MK 3,128 million (2012 MK 2,025 million) which includes Foreign Exchange Losses of MK 633 million (2012 MK 1,062 million). The Net Profit after Taxation for 2013, increased by 275% to MK 2,598 million, from MK 692 million in 2012. The Capex Additions for the year totalled MK 3,085 million (2012: MK 8,038 million) and consisted mainly of Core network upgrades and capacity expansion projects. OUTLOOK The profitability of the business has recovered to acceptable levels and is expected to continue improving in 2014. The company has initiated various business expansion strategies, supported by significant investment in the Data network, network modernization and capacity expansion. DIVIDENDS Total Dividends of MK 1,104 million (MK 0.11 per share) are proposed for the period ended 31 December 2013: MK 301 million 3t per share was declared and paid in September 2013 MK 301 million 3t per share was declared in December 2013 and paid in January 2014. MK 502 million 5t per share to be declared at the upcoming AGM* *The Directors propose a Final Dividend of 5 (five) Tambala per share out of the profits of the company for the year ended 31 December 2013, to be declared at the forthcoming Annual General Meeting. BY ORDER OF THE BOARD Mathews Chikaonda Willem Swart Chairman Managing Director KEY FINANCIAL HIGHLIGHTS 62%SERVICE REVENUE GROWTH K 28,257 87%INCREASE IN EBITDA MILLION K 10,095 MILLION EBITDAMARGIN 35% CAPEXINVESTMENT ADDITIONS K 3,085 MILLION 275%INCREASE IN NET PROFIT (AFTER TAXATION) K 2,598 MILLION ARPU K 1,152 EARNINGS K 0.26 PER SHARE TNM as a Malawian company is committed to be a sustainable and profitable business which will continue to invest in infrastructure in our country and contribute significantly to building the Great Nation of Malawi.
    • AUDIT OPINION Independent Auditor’s report to the members of Telekom Networks Malawi Limited. The accompanying summary financial statements, which comprise the summary statement of financial position as at December 31, 2013, the summary statement of comprehensive income and summary statement of cash flows for the year then ended, are derived from the audited financial statements of Telekom Networks Malawi Limited for the year ended December 31, 2013. We expressed an unmodified audit opinion on those financial statements in our report dated 20 March 2014. Those financial statements, and the summary financial statements, do not reflect the effects of events that occurred subsequent to the date of our report on those financial statements. The summary financial statements do not contain all the disclosures required by the International Financial Reporting Standards and the Malawi Companies Act, 1984. Reading the summary financial statements, therefore, is not a substitute for reading the audited financial statements of Telekom Networks Malawi Limited. Management’s Responsibility for the Summary Financial Statements Management is responsible for the preparation of a summary of the audited financial statements in accordance with the International Financial Reporting Standards and in the manner required by the Malawi Company’s Act, 1984. Auditor’s Responsibility Our responsibility is to express an opinion on the summary financial statements based on our procedures, which were conducted in accordance with International Standard on Auditing (ISA) 810, “Engagements to Report on Summary Financial Statements.” Opinion In our opinion, the summary financial statements derived from the audited financial statements of Telekom Networks Malawi Limited for the year ended December 31, 2013 are consistent, in all material respects, with those financial statements, in accordance with the International Financial Reporting Standards and the Malawi Companies Act, 1984. Public Accountants Blantyre, Malawi STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 December 2013 2013 MK’million 2012 MK’million Service Revenue 28,257 17,445 Hardware and Equipment Revenue 617 596 Total Revenue 28,874 18,041 Direct Operational Costs (13,057) (8,739) Gross profit 15,817 9,302     Other Income 240 259 Selling and administrative expenses (5,962) (4,154)     Earnings before interest, tax, depreciation     and amortisation 10,095 5,407 Depreciation and Amortisation (3,092) (2,196)     Results from operating activities 7,003 3,211     Finance Income 248 52 Finance expenses (3,376) (2,077)     Net finance expense (3,128) (2,025)     Profit before income tax 3,875 1,186 Income tax expense (1,277) (494)     Profit for the year 2,598 692     Other comprehensive income - -     Total comprehensive income for the year 2,598 692     EBITDA margin 35% 30% EBITDA per share (MK) 1.01 0.54     Dividend per share (MK) 0.09 0.07     Earnings per share     Basic earnings per share (MK) 0.26 0.07     Number of ordinary shares in issue (millions) 10,040 10,040 STATEMENT OF FINANCIAL POSITION as at 31 December 2013 2013 MK’million 2012 MK’million     ASSETS     NON-CURRENT ASSETS     Property, plant and equipment 17,949 18,783 Intangible Assets 1,732 942 Total Non-current Assets 19,681 19,725     CURRENT ASSETS     Inventories 500 784 Trade and other receivables 3,278 1,546 Amount due from related companies 396 775 Income tax recoverable - 81 Bank and cash balances 778 515     Total Current Assets 4,952 3,701     TOTAL ASSETS 24,633 23,426     CAPITAL AND LIABILITIES         EQUITY     Share capital 402 402 Share premium 2,347 2,347 Retained earnings 7,164 5,469     Total Equity 9,913 8,218     NON-CURRENT LIABILITIES     Deferred tax 174 418 Long-term portion of interest bearing loans 1,618 2,793     Total Non-current Liabilities 1,792 3,211     CURRENT LIABILITIES     Bank overdraft 5,353 4,083 Current portion of interest bearing loans 1,568 1,462 Dividend payable 301 201 Deferred income 1,176 611 Trade and other payables 3,728 5,640 Income tax liabilities 802 -     Total Current Liabilities 12,928 11,997     Total Liabilities 14,720 15,208 TOTAL EQUITY AND LIABILITIES 24,633 23,426 STATEMENT OF CASHFLOWS for the year ended 31 December 2013 2013 MK’million 2012 MK’million Cash flows from operating activities Cash receipts from customers 27,762 17,686 Cash payments to suppliers and employees (20,569) (11,077) Net cash generated from operations 7,193 6,609 Interest paid (2,743) (1,016) Income tax paid (638) (754) Net cash generated by operating activities 3,812 4,839 Cash flows to investing activities Interest received 248 52 Acquisition of property, plant and equipment (2,006) (7,504) Purchase of software (1,079) (534) Proceeds from sale of property, plant and equipment 29 11 Net cash used in investing activities (2,808) (7,975)   Cash flows to financing activities   Dividend paid (803) (703) Repayments of loans (1,208) (1,535) Proceeds from loans - 2,145 Net cash used in financing activities (2,011) (93) Net decrease in cash and cash equivalents (1,007) (3,229) Cash and cash equivalents at beginning of year (3,568) (339) Cash and cash equivalents at end of year (4,575) (3,568) Additional statutory requirement Decrease in net working capital (2,980) (5,114) Results for the year ended 31 December 2013