Big Blue Label earnings boost — but there’s a catch – MyBroadband

Blue Label Telecoms has released a trading statement for the year ended 31 May 2024, telling shareholders to expect a significant increase in headline and core headline earnings per share.

However, this includes the effects of Cell C’s recapitalisation. When excluded, headline and core headline earnings per share declined by a whopping 34%.

JSE’s listing requirements state that companies must inform shareholders as soon as they are reasonably certain their financial results will be 20% higher or lower than the previous comparative period.

Including the effects of the Cell C recapitalisation, Blue Label Telecoms anticipates a 73% to 77% increase in headline earnings per share, from 41.97 cents per share in May 2023 to between 72.80 and 74.48 cents per share in May 2024.

It anticipates a 65% to 69% increase in core headline earnings per share, reaching between 75.17 and 76.99 cents per share. Blue Label Telecoms reported core headline earnings per share of 45.55 cents in May 2023.

“Core headline earnings for the year ended 31 May 2024 amounted to R679 million (May 2023: R402 million), equating to core headline earnings of 76.08 cents per share (May 2023: 45.55 cents per share),” it said.

However, it noted that the Cell C recapitalisation positively contributed R66 million in the 2023/24 financial year.

This, combined with the project’s negative contributions of R523 million in 2022/23, significantly boosted Blue Label Telecom’s earnings in 2023/24.

Excluding these effects, Blue Label Telecom’s core headline earnings per share declined by 34% from R925 million to R613 million.

“Consequently, core headline earnings per share also dropped by 34%, from 104.83 cents per share to 68.66 cents per share,” it said.

It added that, when excluding the positive and negative effects of the recapitalisation for both years, earnings per share and headline earnings per share dropped by 35% to 65.07 and 66.22 cents per share, respectively.