Johannesburg - Telecommunications service provider Blue Label Telecoms’ [JSE:BLU] headline earnings per share surged by as much as 22% for the year ended May 31, 2016.
Core headline earnings per share rose by 21% to 102.85 cents while earnings per share rose by 20% to 103.85 cents.
Dividends were declared at 16% to 36 cents per share and the total revenue grew by 19% to R 26.2bn, with a gross profit increase of 11% to R1.8bn.
The company’s market capitalisation for the year ended May 31 stood at R12bn, at R18 per share.
Blue Label, which deals with the distribution of prepaid airtime, starter packs and prepaid electricity also noted in the report that there was an increasing interest from service providers to emulate the prepaid electricity model and apply it to prepaid water.
Contributing to the company’s growth was the securing of 700 000 new SIM card connections per month and ‘chat 4 change’ sales up by 75%. Prepaid electricity sales were also up by 15% to R12.1bn, averaging R1bn per month.
“The group’s performance was primarily attributable to organic growth, underpinned by an expanding multitude of distribution channels and in turn a growth in market share,” Blue Label’s Stock Exchange News Service (SENS) statement read.
Also reported in the statement was that “growth in revenue of 19% was organically achieved through increased sales by expanding distribution channels.”
“Revenue generated on 'PINless top-ups' increased by R1.4bn from R2.7bn to R4.1bn, equating to effective growth in South African distribution revenue of 23%, in that only the commission earned thereon is recognized,” the statement further read
Brett Levy, joint CEO of the company, also said at a media briefing on the earnings results on Wednesday that an acquisition stake in Cell C was “progressing positively”.
READ: Blue Label’s Cell C acquisition deal ‘on track’
Blue Label plans to acquire 35% of Cell C for R4bn as part of a recapitalisation plans for the mobile network.