Fin24

Telkom losses stack up

2012-09-21 12:33

Johannesburg - Telkom shares declined 5.32% to R18.34, adding to a 5.5% drop on Thursday, when the fixed-line operator warned that first-half earnings will likely fall as much as 65%, hit by a $55m regulatory fine.

The Competition Commission last month slapped Telkom [JSE:TKG] with a R449m fine for using its dominant market position to stifle potential competitors.

The fine is the latest setback for struggling Telkom, which has been hurt by the steady decline in fixed-line usage and a failed expansion into Nigeria.

Its return on equity over the last 12 months has been just 0.2%, according to Thomson Reuters data, compared with an average of 27.5% for five other emerging markets telecom firms.


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Comments
  • Tobie Vd Vyver - 2012-09-21 13:14

    and so the wheel turned...

      buzz.bar.16 - 2012-09-21 20:32

      Parastatals should parasitals... All they do is leach money off the tax payer.

  • steve.blignaut - 2012-09-21 13:18

    Good. Die already so that others can live....

  • emillangeveld - 2012-09-21 13:27

    But once again, the Government, with an almost 40% share in Telkom snubbed the Korean company's partnership proposal a little while back. This would have made the useless lot much more effective ... and maybe even turned around their "..steady decline..." Why do I believe our tax money will once again be used by Government to 'bail them out?'

      dhavandran.palavar - 2012-09-21 13:33

      as usual gordhan has provided his comrades a bottomless pit of taxpayers monies. all parastatals will run at a loss with huge bonuses for the ceo's and taxpayers monies to bail them out.

  • sisie.indola - 2012-09-21 13:27

    They should have privatized Telkom years ago, now it will be a liability and more money will be sunk into this dead ship.

  • michael.heys.3 - 2012-09-21 13:42

    Just an indication of what nationalisation could bring. The government csn't even run a p--s up in a brewery.

      felix.feline.3 - 2012-09-21 13:55

      I disagree, that's about all they can do... Anywhere.

      colin.dovey - 2012-09-21 14:12

      What Nationalisation WILL bring.......Telkom are already panicking - for the first time EVER, I encountered one of their Reps in a Supermarket, trying to sell some of their "latest" packages - and when you talk about the way they are "throttling" our line speed, and yet we pay massive monthly fees, they cannot answer.

  • john.dough.5836711 - 2012-09-21 16:47

    A very clever way to delist Telkom cheaply: destroy the shareholder value...buy out the minorities and then pass laws to revive the now privately held company. Bloody Economic Terrorists.

  • ryan.wedlake - 2012-09-21 18:21

    That is what happens when cadres are deployed to management positions!

  • aiazmir - 2012-09-21 20:30

    It is amusing that the ANC cadres who benefited from the Telkom privatisation, must now bite the bullet. Telkom is incompetent on so many levels. Their biggest asset is their undersea cables. Above the sea they are a failure. They have been laying optical fibre cables that has cost a bomb, but like any cable they must be connected. I can just imagine all the labourers and technicians digging up our pavements again trying to detect disconnections. Go Telknom, or should I say Hellkon.

      heidi.lundie - 2012-09-21 22:42

      Those people have already left the sinking ship. They got fat severant packages and moved on to more profitable options. Some of the "previously advantaged" workers has knowledge and experience but they can't get promotions because of BEE and AA. The "previously disadvantaged" workers get positions that they can't cope with without proper training. The biggest problem is that people get jobs because they are of a certain color and race, and NOT because they are the best person for the job. We can't blame the person that get the job, we must blame the idiot that placed them there without backing the position up with proper training.

  • heidi.lundie - 2012-09-21 22:31

    The real losers here is the telkom workers, who are under trained, under paid and totally demotivated. We expect these people to do their jobs, and even the ones who are willing, are not always equipped with the knowledge and equipment to do so. Telkom roll out a new product but the staff does not get training before hand. People get laid of by the thousands and the workload increase. They transfer people from other sections that does not have the ability to do the job at hand. Female technicians that can't even carry a ladder! Or open a manhole ? Some of the technicians are so badly trained that they can't do their jobs, they end up making it easier on themselves by disconnecting lines that are working fine before a weekend they are working, so that this "faults" would be put on their names and to ensure that they at least KNOW what the problem is. Or they use working lines to fix broken ones and then the previously working line ends up as a new fault the next day. (Swopping the broken line for a working one) Telkom do have a problem, but it starts at the managements side. Give these people the knowledge , the incentives and the equipment to do their jobs and it will solve most of the problems. They also need a substantial increase.

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