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BTC revenue soar

Botswana Telecommunications Corporation Limited (BTC), recorded a 4% increase in total revenues translating to P719m in comparison to P694m in the prior half year. The positive trend in revenue was due to an increase in data revenues from both Fixed and Mobile Businesses.

The only local listed telco- operator in the country recorded a profit of P83 million, while the total assets increased from P2. 4 billion to P2. 6 billion. The telco- operator is expected to continue posting impressive results despite the harsh economic conditions defined by below par diamond exports. Today, BTC has by far the highest dividend yield on the Botswana Stock Exchange (BSE). It remains unmatched since listing on the local bourse three years ago.

The BTC stock has been stable over the last couple of months owing to an increase in knowledge of stocks by some retail shareholders and uptake of BTC stock by astute investors who know the shares are undervalued. Long term investors were not moved by the short-term volatility of BTC stock in the past as the fundamentals remained strong for the business.

“In fact, any short-term weakness should be taken as an opportunity by astute long-term investors to increase their holdings. We have seen it before how some astute investors have taken advantage of BTC share price drop by increasing their holdings and they have been rewarded handsomely when then share price picked up,” says Garry Juma Motswedi Securities Head of Research and Executive Director.

The performance of some local companies including BTC has been attributed to the depressed local markets and global uncertainties. The Economic Review of Q3 2019 with contributors such as Keith Jefferies highlights that the year has been defined by below par diamond exports dropping to as much as 50%. The environment is subdued despite a tight leash on inflation and bank rates. “Our diamond sales which are the main drivers of the economy were not spared the global market anxiety of the US and China trade wars, the SA junk status and the Brexit reality,” says another Independent Economist.

Due to the tough trading environment, which has been quite a challenge for the private sector, the stagnant household income has affected the average revenue per user (ARPU). BTC, however, has been defiant in defending its sustainable competitive advantage of a network which envelopes not just the eastern corridors of the country but every city, village and area across Botswana.

BTC has made huge contributions towards heightening its competitive advantage in the market and thus proves an ideal haven for long-term investors. BTC is unparalleled in mobile network coverage which covers the whole country estimated to cover 90% of the population. The firm’s network coverage pans across previously undeserved remote areas where competitors have little to no presence.

BTC’s investment case is supported by strong fundamentals such as Convergent product offering – Given BTC’s unique position as the sole fixed network operator, the firm is able to offer its fixed, mobile, and other products and services in a convergent portfolio. Leveraging on this competitive advantage is a key component of its commercial strategy.

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China’s GDP expands 3% in 2022 despite various pressures

2nd February 2023
China’s Gross Domestic Product (GDP) expanded by 3% year-on-year to 121.02 trillion yuan ($17.93 trillion) in 2022 despite being mired in various growth pressures, according to data from the National Bureau Statistics.

The annual growth rate beat a median economist forecast of 2.8% as polled by Reuters. The country’s fourth-quarter GDP growth of 2.9% also surpassed expectations for a 1.8% increase.

In 2022, the Chinese economy encountered more difficulties and challenges than was expected amid a complex domestic and international situation. However, NBS said economic growth stabilized after various measures were taken to shore up growth.

Industrial output rose 3.6% in 2022 over the previous year, while retail sales slightly shrank by 0.2% data show that fixed-asset investment increased 5.1% over 2021, with a 9.1% hike in manufacturing investment but a 10% fall in property investment.

China created 12.06 million new jobs in urban regions throughout the year, surpassing its annual target of 11 million, and officials have stressed the importance of continuing an employment-first policy in 2023.

Meanwhile, China tourism market is a step closer to robust recovery. Tourism operators are in high spirits because the market saw a good chance of a robust recovery during the Spring Festival holiday amid relaxed COVID-19 travel policies.

On January 27, the last day of the seven-day break, the Ministry of Culture and Tourism published an encouraging performance report of the tourism market. It said that domestic destinations and attractions received 308 million visits, up 23.1% year-on-year. The number is roughly 88.6% of that in 2019, they year before the pandemic hit.

According to the report, tourism-related revenue generated during the seven-day period was about 375.8 billion yuan ($55.41 billion), a year-on-year rise of 30%. The revenue was about 73% of that in 2019, the Ministry said.

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Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

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Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

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