In terms of paragraph 3.4(b) of the Listings Requirements of the JSE Limited, 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 year ended 31 March 2010, which are expected to be released on or about Monday, 21 June 2010.
In South Africa, EBITDA continues to be impacted by increases in operating costs which outstrip revenue growth.
In Nigeria, economic and competitive conditions were tough. In addition, inventory write downs and subsidies were higher and accordingly, Multi-Links Nigeria will report EBITDA losses higher than that of the previous year. The level of inventories and inventory commitments were abnormally high given the market circumstances of Nigeria and have been normalised.
As previously reported we successfully concluded the sale and unbundling of our 50% stake in Vodacom during the year which resulted in the following unusual items impacting earnings for the year:
Other once off items impacting the results include:
Normalised headline earnings per share ('HEPS') from continuing operations for the period, which excludes all the unusual items listed above, are expected to be between 5% higher and 15% lower than the normalised HEPS of 506.1 cents for the year ended 31 March 2009. Headline earnings per share, which includes the STC on the special dividend, the compensation expense and the fair value loss on Vodacom shares, are expected to be between 80% and 100% lower than the reported HEPS of 606.7 cents for the year ended 31 March 2009.
Basic earnings per share ('BEPS') including the profit on sale and gain on unbundling of Vodacom and all expenses related to the transaction are expected to be 1,505% to 1,525% higher than the BEPS of 457.4 cents reported for the year ended 31 March 2009. BEPS from continuing operations for the year are distorted by the accounting for the sale and unbundling of our 50% stake in Vodacom. Normalised BEPS from continuing operations, which excludes the profit on sale and gain on unbundling of Vodacom and all expenses related to the transaction, are expected to be between 5% higher and 15% lower than the normalised BEPS of 456.6 cents per share for the year ended 31 March 2009.
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 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.
14 May 2010