Neotel 'joins big boys'

Johannesburg - Unlisted telecommunications group Neotel said on Tuesday it has already crossed R2.2bn in annualised revenue for the financial year which ends March 2010.

Neotel CEO Ajay Pandy said that the company is aiming at the R3bn revenue mark by the time it closes the year. He added that initial funding for the company has been factored in.

"Our peak funding requirement has been taken care of. We're not looking for any more funds at this stage," said Pandy. According to him Neotel has shown strong performance in the wake of a restructuring that abandoned having separate operating units within the company.

"We have essentially moved to a very simple, four-quadrant approach that will help us to leverage efficiencies throughout the company," he said.

In terms of spending, Pandy said Neotel has committed over R3.3bn in capital expenditure towards infrastructure. This includes investments in two datacentres, one in Johannesburg and another, under construction, in Cape Town, along with partnerships with Vodacom and MTN for national long-distance connections.

"The partnership with Vodacom and MTN is working well. I'm a big fan of infrastructure sharing," he said.

Pandy added that the long-distance connection between Johannesburg and Durban is well underway and that the link between Johannesburg and Cape Town is in advanced planning stages.

With the increased revenue, Pandy said Neotel is pleased to now be positioned above the league of smaller internet service providers in South Africa. Referring to interconnect rate discussions, Pandy said Neotel had "joined the club" of leading telecommunications providers.

He added that Neotel clients now include Internet Solutions, Standard Bank, Vox Telecom, the State Information Technology Agency and the National Health Laboratory Service. In total, Neotel claims to have more than 500 enterprise customers.

- Fin24.com