| Wed 10 Nov 2010, 8:00 | | TKG - Telkom SA Limited - Telkom trading statement |
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TKG
TKG
TKG - Telkom SA Limited - Telkom trading statement
Telkom SA Limited
(Registration Number 1991/005476/06)
ISIN ZAE000044897
JSE Share Code TKG
("Telkom")
TELKOM TRADING STATEMENT
In terms of paragraph 3.4(b) of the JSE Listings Requirements, companies are
required to publish a trading statement as soon as they become reasonably
certain that the financial results for the period to be reported on next will
differ by at least 20% from those of the previous corresponding period.
Telkom is currently finalising its results for the six months ended 30 September
2010, which are expected to be released on or about Monday, 22 November 2010.
Earnings for the six month ended 30 September 2010 are expected to be lower than
the prior period primarily due to:
* higher employee expenditure as a result of the 7.5% salary increase agreed
with the unions and workforce reduction expenditure incurred of
approximately R144 million;
* the inclusion of approximately R205 million operating expenditure relating
to start up costs of the mobile business;
* higher fair value and exchange rate losses incurred due to the mark to
market valuation of forward exchange contracts and interest rate swap
agreements as a result of the strengthening of the Rand; and
* lower investment income as a result of lower cash balances.
Significant once off items impacting the results in the current period include:
* the impairment of the net asset value in Multi-Links Nigeria of
approximately R201 million; and
* STC on the special dividend paid of approximately R60 million.
Normalised headline earnings per share (`HEPS`) from continuing operations for
the period, which excludes once-off items, are expected to be between 0% and 20%
lower than the normalised HEPS of 280.6 cents for the six months ended 30
September 2009.
Headline earnings per share, which includes the STC on the special dividend, the
compensation expense and the fair value loss on Vodacom shares in the prior
year, are expected to be between 240% and 260% higher than the reported HEPS of
a loss of 160.2 cents for the six months ended 30 September 2009.
Normalised BEPS from continuing operations are expected to be between 0% and 20%
lower than the normalised BEPS of 279.0 cents per share for the six months ended
30 September 2009.
Basic earnings per share (`BEPS`) are expected to be 85% to 105% lower than the
BEPS of 7,860.9 cents reported for the six months ended 30 September 2009. BEPS
from continuing operations for the prior period are distorted by the accounting
for the sale and unbundling of Telkom`s 50% stake in Vodacom.
September 2009 September 2010
Basic earnings per
share 7,860.9 85% to 105% lower
Reported 279.0 0% to 20% lower
Normalised
Headline earnings per
share (160.2) 240% to 260%
Reported 280.6 higher
Normalised 0% to 20% lower
The main differences between basic earnings and headline earnings are the profit
on the sale and gain on unbundling of our 50% share in Vodacom in the prior
period and the related capital gains tax and impairments and write-offs relating
to property, plant and equipment and intangible assets.
This trading statement has neither been reviewed nor reported on by the
Company`s external auditors.
Johannesburg
10 November 2010
Sponsor: UBS South Africa (Pty) Ltd
Special note regarding forward-looking statements
Many of the statements included in this announcement, as well as oral
statements that may be made by Telkom or by officers, directors or employees
acting on their behalf related to the subject matter hereof, constitute or
are based on forward-looking statements. All statements, other than statements
of historical facts, including, among others, Telkom`s ability to implement
its mobile strategy and any changes thereto, Telkom`s future financial
position and plans, strategies, objectives, capital expenditures, projected
costs and anticipated cost savings and financing plans, as well as projected
levels of growth in the communications market, are forward-looking statements.
Forward-looking statements can generally be identified by the use of terminology
such as "may", "will", "should", "expect", "envisage", "intend", "plan",
"project", "estimate", "anticipate", "believe", "hope", "can", "is designed
to" or similar phrases, although the absence of such words does not necessarily
mean that a statement is not forward-looking. These forward-looking statements
involve a number of known and unknown risks, uncertainties and other factors
that could cause Telkom`s actual results and outcomes to be materially different
from historical results or from any future results expressed or implied by such
forward-looking statements. Among the factors that could cause Telkom`s actual
results or outcomes to differ materially from its expectations are those risks
identified in Telkom`s most recent annual report, which are available on
Telkom`s website at www.Telkom.co.za/ir and, other matters not yet known
to Telkom or not currently considered material by Telkom. Telkom caution
you not to place undue reliance on these forward-looking statements. All
written and oral forward-looking statements attributable to Telkom, or persons
acting on their behalf, are qualified in their entirety by these cautionary
statements. Moreover, unless Telkom is required by law to update these
statements, Telkom will not necessarily update any of these statements either to
conform them to actual results or to changes in Telkom`s expectations.
Date: 10/11/2010 08:00:05 Produced by the JSE SENS Department.
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indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
