Telecommunications specialist TeleMasters released its 2009 results today. The AGM will take place on 1 April. The annual report encapsulates what has become a traditionally strong showing from the company described as a “Raging Bull” by the prestigious Red Hot Penny Shares Portfolio.
The TeleMasters AGM will once again be streamed live on the company's Web site - TeleMasters remains the only listed South African enterprise to stream its AGM live, after initiating the practice at its 2009 AGM.
“I believe our success lies not only in the numbers, but also in the company structure,” says Mario Pretorius, TeleMasters CEO. “Obviously strong returns are imperative for shareholders, but these can't come at the expense of long-term growth and structural integrity. Our success has been to blend the two elements.”
TeleMasters, which ranked an impressive 8th on the 2009 Sunday Times Top 100 Shares Index (according to returns offered to shareholders), approached the global recession very aggressively, focusing on putting in place a client-centric approach to business that required additional investment in sales skills.
The aggression paid clear dividends, with a R1.97 million increase in employee costs garnering an impressive R52 million revenue increase. Supporting the company's spend on talent was a substantial investment (roughly R920 000) in the next-generation digital equipment necessary to secure competitive advantage in an increasingly deregulated telecommunications industry.
“Our various tactical steps have all fed into our core strategy of achieving strong organic growth and maintaining a healthy cash positive position in general,” says Pretorius. “Achieving this in the context of a downturn means identifying and resolving areas of weakness and process inefficiencies as a corporate lifestyle. To this end, we've utilised the services of professional consultants to analyse the business comprehensively. In addition, aside from the structural evolution of the business we've also focused on the nature of our offering moving forward. Our business of carrying cellular destined calls from corporate companies, for example, will be a stepping stone to a wider offering in the future.”
For shareholders, the bottom line has been satisfying. TeleMasters has paid regular quarterly dividends to shareholders (TeleMasters was the first listed company in the country to seek to pay monthly dividends - a move which did not come to fruition due to regulatory obstacles), while it's share price has held steady around the R2 - in stark contrast to the fortunes of plummeting rivals. The company paid out another 4c dividend to shareholders at this month's AGM.
“It's been a hard few years across the global economy,” says Pretorius. “Within this context I believe TeleMasters has performed exceptionally well. Our shareholders are satisfied with their returns, and, most important, we're operationally lean and well placed to achieve steady, ongoing growth. We're keenly looking forward to the year ahead.”
Results snapshot
Revenue - up 29%
Gross profit - up 13.8%
Earnings per share 34.29 cents
Return on equity 63.1%
Return on assets 37%
Net tangible asset value per share - up 37.4%
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