Zimbabwe's Powertel Announces A Plan To Re-Start Operations
Powertel, Zimbabwe's state-owned ISP is putting into action a three-year plan to return to profitability after the Auditor General declared that the company's ability to continue growing was a concern and that its future was uncertain.
The government has resolved to merge poor performing Zimbabwe parastatals that include telecom companies. Powertel will at this point be joined with ISPs Zarnet and Africom.
According to the Zimbabwean Auditor General's office, Powertel suffered a loss before tax of US$3 million for the year that ended in December 2017. Its current liabilities also far exceeded its current assets by US$6.4 million.
Auditor General Mildred Chiri released a report this stating that the company’s financial state indicated the existence of a severe uncertainty that would cast significant doubt about the telecom's ability to continue operating.
She added that Powertel's daily operations continued to suffer with total revenue for the 2017 full year decreasing from US$25.7 million to US$25.1 million.
However, management at the company said that they are working on a turnaround strategy to overcome the losses and to start to grow earnings.
An extract from a statement issued by the company declares that the company has devised a business strategy that will run over three years and is expected to catapult the company to profitability this by the end of the year (2018).
Executives at the company said that Powertel’s cash-flow challenges were caused by the liquidity challenges being experienced in the Zimbabwean economy as a whole.
Powertel added that efforts to improve collections from customers including acquiring the services of legal firms for the recovery of long outstanding debts had been adopted in an attempt to help the company in keeping up with payments of statutory obligations.
State-owned tech entities like TelOne and NetOne are also experiencing financial turmoil, and this has resulted in government implementing measures to contain excessive capital flows to these organisations.
Credit: This article originated from www.itwebafrica.com