Botswana Telecommunications Corporation Limited
ABRIDGED UNAUDITED 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 unaudited 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
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
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Disclaimer
BTC - Botswana Telecommunications Corporation Ltd. published this content on 30 June 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 June 2022 15:12:06 UTC.