Namibia Telecom Blames Cabinet Restriction for Sluggish Growth

Mergers, Acquisitions and Financial Results

The Managing Director of Telecom Namibia, Frans Ndoroma, said the negative perception around the Switch product emanating from the restriction imposed by Cabinet is one of the factors that contributed to the current sluggish growth in the company's turnover.

Other factors included the imposition of value added tax (VAT) on prepaid products and the absence of bandwidth capping on the broadband services. According to him, preliminary figures show that his company's turnover for 2008 grew by 3 per cent to N$1.07 billion, adding that an increase in role-players in the industry had decreased his company's turnover growth.

He said net income before tax for 2008 amounts to N$98 million, which is 19.44 per cent below budget, adding that this is attributable to the below-budget sales. He noted that capital expenditure in the local infrastructure and fixed asset acquisitions amounted to N$235 million in 2008, adding that the cumulative capital expenditure over the past five years stands now at N$1.1 billion, an investment which increased the current fixed asset base to N$2.6 billion.

The Namibian