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Data income keeps Zimbabwe's Econet ahead

By , Journalist
Zimbabwe , 01 Jun 2016

Data income keeps Zimbabwe's Econet ahead

Data is increasingly helping African mobile companies absorb the impact of revenue losses from the declining voice services category.

This was affirmed by Econet Wireless Chief Executive Officer Douglas Mboweni who, upon reflection of his company's performance for the full year to end February 2016, said that investment in data has helped the company to grow.

The Zimbabwe telco reported a 14% decline in revenues on Tuesday, although revenue from data jumped by 18% and income from data services surged by US$10 million to US$113 million.

"Had we not invested in data, today we would be seeing a company that's half the size we have today," said Mboweni.

It reported that overall revenues had declined by 14% to US$641 million. Ebitda earnings at US$238 million were weaker from the 2015 Ebitda earnings of US$286 million, while after tax profits weakened to US$40.2 million.

The company explained that the revenue and profit decline was attributable to "high depreciation".

Mobile money subscribers remained strong during the period under review and the company will focus on this area, as well as data, to broaden its revenue streams and cover up for voice.

Finance director, Roy Chimanikire, said: "These results reflect the impact of the regulatory tariff reductions as well as a cocktail of taxes and levies which include 5% excise duty and the increase in USF levy. This has effectively reduced our tariffs while directly increasing our costs through additional tax burden".

Registered mobile subscriber numbers for the period grew by 9% to 10 million despite the de-registration of over 1 million subscribers.

Econet Wireless last year disconnected unregistered subscribers "in compliance with regulatory requirements" for proper registration.

"The revenue lost from the de-registered subscribers amounted to US$2 million and the cost to reconnect these subscribers came to $500 000," Econet said.

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