TeleMasters posts huge profit

Revenue of R113m was up 38% from R82m and it retained R6,7m of that in net profit, up a healthy 43% from R4,7m a year ago. The rise in revenue was partly due to acquisitions made during the past few months, with further growth coming from concerted efforts to enhance its operating abilities.

The most recent deal saw it acquire One Communications, which helps companies cut their phone bills by routing calls on to whichever network offers the cheapest connection.

Headline earnings per share of 16c were up from 11,2c, allowing TeleMasters to pay a capital distribution of 4c per share. Paying a capital distribution rather than a dividend saved the company secondary tax of R168 000. The directors said they would continue to pay quarterly capital distributions or dividends, but had abandoned any formal dividend policy.

Its shares gained 10c to trade at 185c after its results were issued.

Directors said the growth in revenue and earnings was the result of tight control of expenditure and continued efforts to ensure it delivered services efficiently to its customers.

“We will continue to focus on the critical aspects of cash flow management and increased customer service delivery,” the board said. Those tactics would allow TeleMasters to continue growing despite the slow down in the economy. Most of its income comes from annuity contracts.

Source: Business Day

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