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Our performance
Our business
Governance review
Administration
Overview
Rm
2016
2015
Restated
1
Revenue
80 077
74 500
Direct expenses
(31 594)
(30 589)
Staff expenses
(5 557)
(4 836)
Publicity expenses
(1 986)
(2 008)
Other operating expenses
(10 844)
(10 118)
Black Economic Empowerment
(charge)/income
(55)
47
Depreciation and amortisation
(8 735)
(7 581)
Impairment losses
(14)
–
Net loss from associate and
joint venture
(233)
(180)
Operating profit
21 059
19 235
Finance income
716
346
Finance costs
(2 196)
(1 737)
Net (loss)/gain on remeasurement
and disposal of financial
instruments
(735)
7
Profit before tax
18 844
17 851
Taxation
(5 934)
(5 341)
Net profit
12 910
12 510
Attributable to:
Equity shareholders
12 917
12 672
Non-controlling interests
(7)
(162)
12 910
12 510
Year ended 31 March
Cents
2016
2015
Basic earnings per share
881
864
Diluted earnings per share
857
845
1.
Prior year restatement
The Group provides financing to customers to acquire handsets at an additional contractual charge in both the direct and indirect
distribution channel. In the indirect channel, the Group historically recognised equipment revenue from finance deals on a gross basis
with the corresponding cost in direct expenses. This accounting treatment has been revisited, since, in the indirect channel, the Group is
not responsible for transferring the handset to the customer and is, therefore, financing the acquisition of the handset by the customer.
As a result, the Group has restated its consolidated income statement to reflect only the finance income on these transactions as
revenue. This resulted in a decrease in equipment revenue and a corresponding decrease in direct expenses in previous financial years.
The restatement has no impact on earnings or earnings per share. The amount of the correction was as follows:
Rm
2015
Restated
Revenue
(2 833)
Direct expenses
2 833
43
Revenue increased 7.5% (6.0%*) underpinned by
improved trends in voice and data revenue and a
strong demand for devices.
Total expenses increased 5.1%. Our cost
programme assisted in offsetting higher costs
relating to site growth, inflation and foreign
exchange impacts. Included is a net
foreign exchange gain of R383 million
(2015: R174 million loss).
15.2% increase as a result of our accelerated capex
investment over the past two years.
Loss recognised from our equity accounted
associate investment in Helios Towers
Tanzania Limited (Helios).
Net finance charges increased due to higher
finance costs from increased average debt coupled
with marginally higher cost of debt of 7.4%
(2015: 7.1%) and a R735 million net loss on
the remeasurement of financial instruments,
relating to FEC mark to market valuations
and foreign denominated loans.
Taxation is 11.1% higher due to increased
profitability (+6.4%) and a one-off benefit from
a deferred tax release (+4.0%) in Tanzania in
the prior year.
The allocation of non-controlling interests’ share
of net losses reduced from the prior year due to
increased profitability in the DRC, slightly offset
by a lower profit contribution from Tanzania
and Mozambique.
Basic earnings per share improved 2.0% supported
by a strong contribution from EBITDA, mostly
offset by increased depreciation and amortisation,
higher net finance costs and remeasurement losses.
Summarised
Consolidated income statement
For the year ended 31 March