Altech expects better earnings

Johannesburg - ICT-giant Allied Technologies (Altech) said it will post improved half-year earnings on Tuesday, despite experiencing one of the toughest operating climates in recent times.

The group said its existing companies are performing well and that new investments are paying off, especially in East Africa where Altech recently increased its holding in Kenya Data Networks (KDN) to 60%.

Altech CEO Craig Venter said East Africa is offering massive opportunities in telecommunications and that the market is pulling ahead of South Africa.

"The last mile has been unbundled and there is a very extensive and professional terrestrial fibre network which has already been deployed and plugs into undersea cables like Seacom," said Venter.

Altech recently penned agreements with both the Teams and Seacom undersea cable companies to bolster the provisioning of international bandwidth in East Africa via KDN.

"Unfortunately in South Africa most of the inland networks are not ready," said Venter.

He said faster deregulation would have helped the local situation but that there is still work to be done before the benefits of undersea cables are experienced.

Venter promised Altech results will reveal a healthy increase in earnings.

"Our earnings will be up between 10% and 15% in what is probably the worst economic climate since the great depression," he said.

"We're also expecting to receive some good benefits from the investments we've made now. So things are on track for the year-end as well," Venter added.

Venter said that Altech will end the year cash positive despite the extensive new investments.

"We still see our balance at the end of this year being up at about the R700m worth of cash, and that's after all of these investments," he said.

- Fin24.com