Due to uncertainties presented by the COVID-19 pandemic, the Botswana Telecommunications Corporation Limited (BTCL) board has recommended, out of financial prudence, that no final dividends be declared in order to retain cash in the business.
This comes after the BTCL showed resilience during the tough period of the Covid-19 pandemic recording P1.4 billion in revenue coupled with a profit before tax of P127million for the reporting period ending 31 March 2020.
Garry Juma, Head of Research at Motswedi Securities commented: “Given the operating environment BTC did well in the review period. I appreciate the holding of the dividend in the interim because of the market uncertainty. This was the best thing to do as they will keep the cash to grow the business. The pandemic caught us unaware and we did not know it would hit us in such a way.”
Juma said the move is an appropriate measure to keep the business afloat during this period.
For the year under review, the telco giant has also seen its margin improve to 24.4 percent despite the tougher trading conditions in a very competitive environment.
Latest economic estimates are indicating economic contraction as opposed to pre COVID-19 growth of 4.4 percent for Botswana and 3.3 percent for global growth.
As a result, BTCL will continue to monitor developments related to the COVID-19 pandemic, including Government requirements and recommendations to evaluate possible extensions to all or part of such recommendations.
Managing director, Anthony Masunga said: “We have taken several initiatives to further strengthen our financial position and balance sheet going forward.”
Part of that includes improving on service areas to optimise product offerings and review of the Capital Investment and strict monitoring of Cash Flow projections monthly
Since its historic listing on the Botswana Stock Exchange the Company shares have yielded the superior dividend returns to shareholders as compared to other counters on the Exchange.
The local telco-giant is celebrating “40 Years of Progress” as it reflects on technological advancements and its role in anchoring the national economy.
BTC’s fixed and mobile networks will continue to provide a superior customer experience as we create seamless services using a combination of fixed broadband and wireless technologies to meet customer needs in homes, offices, and on the go. The recent investments in fixed and mobile broadband put us in pole position for the next phase of growth by differentiation through reliability, speed and coverage, laying a foundation for the 4th Industrial Revolution.