The operating environment remained challenging for Econet as sub-economic tariffs amidst a depreciating local currency continued to threaten the long-term viability of the local telecoms sector. Although the Regulator granted the sector a tariff adjustment of 50% during the period (in April), the sector's operating costs grew by a larger margin owing to the inflationary environment. Nevertheless, following years of under-investment, Econet spent 24% of its revenue towards capex during the period under review and leveraged its partnerships with major equipment vendors to modernise 691 base station sites covering Harare and Bulawayo, thus improving performance, capacity and coverage. The Group saw volumes growth of 24% and 25% for voice and data, respectively compared to the prior year period. Consequently, historical revenue increased 1,035% to ZWL$836.35bn from ZWL$73.71bn in 1H23. EBITDA grew 1,184% to ZWL$428.17bn from ZWL$33.32bn in 1H23, with EBITDA margin rising from 45.2% to 51.19%. However, the Company was unable to redeem its matured debentures during the period due to inability to secure foreign currency via the RBZ's foreign currency auction. Consequently, exchange losses from the USD- denominated liabilities driven by the weakening local currency continued to have a negative impact on the Group's performance. The Group incurred exchange losses of ZWL$287bn, representing 34% of total revenue. Resultantly, the Group posted a loss before monetary adjustments in real terms, but historical PAT was up 633% to ZWL$28.2n. Econet closed the period with ZWL$94.67bn in cash against ZWL$362.66bn in debt. The Group did not declare an interim dividend for the period in light of its ongoing capital expenditure program.
