Botswana Telecommunications : ABRIDGED AUDITED ANNUAL FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2022

Botswana Telecommunications Corporation Limited

ABRIDGED AUDITED ANNUAL FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2022

The Board and Management of Botswana Telecommunications Corporation Limited ('BTC') are pleased to present to shareholders the audited financial results of the Company for the year ended 31 March 2022.

Dividend	Dividend	Profit
(per share)	Yield	Before tax
5.04thebe	13%	8%

COMMENTARY

Our Business

Botswana Telecommunications Corporation is a converged telecommunications operator oering fixed (voice and data), mobile (voice and data) and broadband services to consumers, enterprise and other licensed service providers.

Review of operations and results

• Dividend per share thebe 5.04 thebe
• Dividend yield at 13%
• Earnings per share up by 2%
• Profit before tax up by 8%
• Revenue decline of 2% from prior year
• EBITDA margin expansion by 170 basis points.
• Cash Conversion at 34%

Performance Overview

The company's operational performance remained resilient with EBITDA growth during the year reecting the increased demand for our products due to the stability and reliability of our network infrastructure. We continued to invest in strategic growth areas and the result was within our forecast in the mobile data and broadband oerings. Our investments included upgrading the mobile network to 4.5G (LTE-A) coverage across the country, rolling out the fibre connectivity upgrades and renewing the VSAT platform, leading to connectivity anywhere in Botswana. Furthermore, the various technology platforms enable us to connect customers across multiple technologies, products and oerings, thus giving us capability to defend and increase our customer base. Some of our key customer segments are taking advantage of this benefit and are utilizing a full suite of our products. The reported revenue slightly declined by 2% to P1.392 billion for the year with the decrease in voice revenues being mainly oset by growth in the data business. EBITDA increased by 3% with margin expansion of 170 basis points due to tight cost management. The cash and cash equivalents at the end of the period of P520 million, are up 43%, driven by improved EBITDA and lower capital expenditure payments.

Domestic Economy

In the short to medium term, the economic growth outlook is subdued and we anticipate a tough operating environment on the back of rising local ination and increasing international commodity prices.

Outlook

BTC's purpose hinges on enabling Batswana to live connected, anchoring Botswana's digital transformation and enabling economic growth. We continue to forge strategic partnerships with key stakeholders and believe that we can play an important role in the development of Botswana and in transforming the business landscape.

As a business, the company's strategic focus for the next few years is to improve our customer experience through improved service oerings and seamless interaction with clients. We are embarking on the digitalization journey, cuing right across the business from operations and processes and leading to enhanced end user experience. We currently oer multiple digital touchpoints on the website, mobile application, USSD codes and the SMEGA financial services. Going forward we will be focused on oering converged touchpoints to allow customers to fully transact across the business.

We are optimistic that the refreshed strategy will leverage on our upgraded technology platforms and continue to provide returns. We are confident in our workforce, network capability and product portfolio; and are proud of the brand equity we have built as a local home grown brand.

	EPS	Revenue	EBITDA Margin			Cash
	(Thebe)	170		Conversion
2%	-2%		Basis Points	34%
	STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
	For the year ended 31 March 2022				Mar 2022		Restated
							Mar 2021
						P '000		P '000
	Revenue from contracts with customers				1,392,257	1,426,409
	Cost of services and goods sold				(604,751)	(592,515)
	Gross profit					787,506	833,894
	Interest income					18,796	6,360
	Interest expense					(22,767)	(26,972)
	Other income					39,918	37,629
	Selling and distribution costs				(18,242)	(20,016)
	Administrative expenses				(403,573)	(409,295)
	Impairment losses and gains on financial assets and contract assets		3,191	(12,865)
	Other expenses					(222,436)	(239,894)
	Profit before tax					182,393	168,841
	Income tax expense					(41,608)	(30,923)
	Profit for the year					140,785	137,918
	Other comprehensive income not to be reclassified to profit /loss
	in subsequent periods					63,874
	Gains on property revaluation				-
	Impairment on assets transferred to held for sale				(7,761)	-
	Income tax eect					1,707	(12,267)
	Other comprehensive income for the year				(6,054)	51,607
	Total comprehensive income for the year				134,731	189,525
	Basic and diluted earnings per share (Thebe):				13.41	13.14
	STATEMENT OF FINANCIAL POSITION
	As at 31 March 2022			Mar 2022		Restated		Restated
					Mar 2021		Mar 2020
				P '000		P '000		P '000
	ASSETS
	Non-current assets			1,449,452	1,571,124		1,509,385
	Property, plant and equipment
	Intangible assets			183,946	205,267		231,922
	Right of use assets			115,337	129,325		144,629
	IRU asset			420,305	458,514		496,723
	Deferred tax assets			-	-		27,451
	Current assets			2,169,040	2,364,230		2,410,110
			53,419	45,222		49,256
	Inventories
	Trade and other receivables		161,122	183,077		223,657
	Contract assets			53,539	35,016		26,363
	Income tax receivable			810	641		13,100
	Cash and cash equivalents		520,442	363,273		118,089
				789,332	627,229		430,465
	Assets held for sale			32,222
				821,554	627,229		430,465
	TOTAL ASSETS			2,990,594	2,991,459		2,840,575
	EQUITY AND LIABILITIES
	Capital and Reserves			478,892	478,892		478,892
	Stated capital
	Revaluation reserve			361,375	382,363		347,603
	Accumulated profits			1,441,428	1,379,999		1,258,099
	Non - Current Liabilities		2,281,695	2,241,254		2,084,594
		8,543	5,593		28,301
	Development grants
	Lease liabilities			115,753	126,362		142,781
	IRU liability			120,590	180,477		236,866
	Deferred tax liability			55,640	15,739		-
	Employee related provisions		7,994	10,513		12,622
				308,520	338,684		420,570
	Current Liabilities			279,765	255,405		192,288
	Trade and other payables
	Contract liabilities			13,522	19,534		26,103
	Lease liabilities			16,718	16,418		10,350
	IRU liability			60,022	56,389		52,723
	Current portion of development grants		860	21,580		29,862
	Current portion of employee related provisions		29,492	42,195		24,085
				400,379	411,521		335,411
	TOTAL EQUITY AND LIABILITIES		2,990,594	2,991,459		2,840,575

STATEMENT OF CASH FLOWS

For the year ended 31 March 2022		Restated
Mar 2022	Mar 2021
	P '000	P '000
CASH FLOWS FROM OPERATING ACTIVITIES	424,365	464,635
Operating cash ow before working capital changes (restated)
Working capital adjustments:	(8,197)	4,034
(Increase) / Decrease in inventories
Decrease in trade and other receivables, contract assets and prepayments	17,034	22,926
Increase in trade and other payables and contract liabilities	18,348	56,548
Cash generated from operations	451,550	548,143
Ordinary dividend paid to shareholders	(92,676)	(31,037)
Net Income tax received	11,649	12,459
Net cash from operating activities	370,523	529,565
CASH FLOWS USED IN INVESTING ACTIVITIES
Investment to expand operations:	(113,050)	(182,050)
Purchase of property, plant and equipment
Purchase of intangible assets	(20,903)	(18,125)
Proceeds from disposal of property plant and equipment	387	771
Interest income received	13,794	5,957
Net cash used in investing activities	(119,772)	(193,447)
CASH FLOWS FROM FINANCING ACTIVITIES	3,465	-
Grants received
Interest paid on lease liabilities and IRU liability	(23,129)	(28,858)
Principal payment of lease liabilities	(17,126)	(16,177)
Principal payment of IRU liability	(55,946)	(50,894)
Net cash from financing activities	(92,736)	(95,929)
Increase in cash and cash equivalents	158,015	240,189
Net foreign exchange dierence on cash and cash equivalents	(846)	4,995
Cash and Cash equivalent at beginning of the year	363,273	118,089
Cash and Cash equivalent at the end of the year	520,442	363,273

STATEMENT OF CHANGES IN EQUITY

For the year ended 31 March 2022					Stated	Revaluation	Accumulated
							Total
							Capital	Reserve		Profits
							P '000	P '000		P '000
Balance at 1 April 2020 as previously stated		478,892	347,603	1,290,068	2,116,563
Impact of correction of prior period errors		-		-		(31,969)	(31,969)
Restated balance at 1 April 2020					478,892	347,603	1,258,099	2,084,594
Profit for the year (restated)					-		-		137,918	137,918
Other Comprehensive income					-	51,607		-	51,607
Total Comprehensive Income (restated)
	-	51,607		137,918	189,525
Ordinary dividend declared					-		-		(32,865)	(32,865)
Depreciation transfer for land and buildings		-	(16,847)		16,847	-
Balance at March 2021 (restated)
				478,892	382,363	1,379,999	2,241,254
Profit for the year						-		-		140,785	140,785
Other comprehensive income						(6,054)		-	(6,054)
Total Comprehensive Income					-	(6,054)		140,785	134,731
Ordinary dividend declared					-		-		(94,290)	(94,290)
Depreciation transfer for land and buildings		-	(14,934)		14,934	-
Balance at March 2022
					478,892	361,375	1,441,428	2,281,695
Restatement of prior year results
The financial results for the year ended 31 March 2021 have been restated and as such the prior year figures presented are the
restated amounts. The impact of the restatement on the Profit or Loss and Other Comprehensive Income and Statement of
Financial Position is as follows:
	The impact of the restatement on the Profit and loss	The impact of the Statement of Financial Position is as follows:
	statement is as follows:
							Previously	Restated P(m)	Previously	Restated P(m)
								Reported P(m)	Reported P(m)
								Mar 2021	Mar 2021	Mar 2020	Mar 2020
		Previously				Non -Current Assets	2,403		2,364	2,442	2,410
		Reported P(m)	Restated	P(m)		Current Assets	627		627	432	430
		Mar 2021	Mar 2021
	Revenues from contracts	1,426	1,426		Capital and Reserves	2,272		2,241	2,118	2,085
	Profit before tax	167	169		Non -Current Liabilities	347		339	421	421
	Profit aer tax	136	138		Current Liabilities	412		412	335	335

Presentation of Financial Statements

The annual financial statements are presented in Botswana Pula which is the Company's functional currency. All financial information and values are rounded to the nearest thousand (P'000) except where otherwise indicated. The financial statements of the Company for the year ended 31 March 2022 were authorised for issue by the Members of the Board in accordance with a resolution on 23 June 2022.

Basis of Preparation and Accounting Policies

The annual financial statements have been prepared on a historical cost basis, except as modified by the measurement of certain financial instruments at fair value and the revaluation of certain assets and on the going concern basis.

The accounting policies adopted for the period comply in all material respects with International Financial Reporting Standards (''IFRS'') issued by the International Accounting Standards Board (''IASB''), interpretations issued by the International Financial Reporting Standards Interpretations Commiee and in the manner required by the Companies Act of Botswana (CAP 42:01).

Change from Group to Company

On 27th of August 2020, the Board of Directors of the company resolved that the BTC Foundation "the Foundation", a wholly owned entity, which was registered as a trust be de-registered and dissolved. The Board of Trustees of the Foundation resolved on the 19th of April 2021 that the Foundation be dissolved and the Deed of cancellation of the Trust was executed on the 21st of September 2021.

At dissolution the Foundation had an unexpended cash balance of P475,040 and had undertaken no activities during the year. The balances were assumed into the Company. The Company has decided to not consolidate the results of Foundation as there was no financial activity in the year and the unexpended cash balances at dissolution were not material. The bank balances in the prior year amounted to P533 850. There is therefore no Group reporting for the current financial year, and accordingly no comparatives have been presented.

Dividend Declared

The BTC Board has declared a final dividend of 5.04 thebe per share for the year ended 31 March 2022. In terms of the Botswana Income Tax Act (Cap 52:01) as amended, withholding tax at the rate of 10% or any other currently enacted tax rate will be deducted from the interim gross dividend.

Important dates pertaining to this dividend are:

Declaration date - 30 June 2022

Ex-dividend date - 10 August 2022

Last date to register - 12 August 2022

Dividend payment date - on or before 24 August 2022

Auditor's report

The auditor, Deloie & Touche, has issued its unmodified opinion on the Company's annual financial statements for the year ended 31 March 2022.

These are available for inspection at the registered oice of Botswana Telecommunications Corporation Limited. This publication has been extracted from those financial statements. This abridged financial information and any reference to future financial performance has however not been audited by the auditors.

By Order of The Board

Lorato Boakgomo-Ntakhwana

Chairperson

Anthony Masunga

Managing Director

Board of Directors

Lorato Boakgomo-Ntakhwana (Chairperson), Anthony Masunga (Managing Director), Maclean Letshwiti, Andrew Johnson*,Ranjith Priyalal De Silva**, Thari Pheko, Bafana Molomo, Gaone Macholo and Thato Kewakae.

*South African **Sri Lankan

Company Secretary

Sidney Mganga

Company Number

BW00000748937

Transfer Secretaries

Central Securities Depository Company of Botswana

Plot 70667, Fairscape Precinct. 4th Floor, Fairgrounds, Gaborone Private Bag 00417, Gaborone

Contact Details: 3674400/ 09/11/12

Contact Person: Nonofo Phalatse or Ambrosia Khupe

Auditor

DELOITTE & TOUCHE

Plot 64518 Fairgrounds

P O Box 778 Gaborone, Botswana

Megaleng House

Plot 50350, Khama Crescent

P.O. Box 700 Gaborone, Botswana