* FY Headline EPS down 33 pct
* Suspends dividend payment from this year
(Adds details)
JOHANNESBURG, June 8 (Reuters) – South Africa’s Telkom
, hit by tough competition and burdensome costs from its
new mobile arm, posted a one-third drop in full-year profit and
suspended its dividend.
The biggest fixed-line phone operator in Africa said
headline earnings per share fell to 324.7 cents in the year
ended March from 484.8 cents a year earlier.
The company, whose top shareholder is the government, said
it would suspend dividend payments from this year as it faces a
cash shortfall.
Telkom’s recently-launched mobile unit has been struggling
to keep up with bigger Johannesburg-based African mobile
operators MTN and Vodacom.
The government recently turned down a $385 million offer for
a 20 percent stake in the company from South Korea’s KT Corp
. The cash injection from the deal would have helped
the struggling firm in its plan to turn around, analysts have
said.
The deal included an issue of new shares for KT, which would
have reduced the government’s shareholding to below the 50
percent it holds jointly with a government-run pension scheme.
Telkom shares are down nearly 30 percent this year, compared
with a 6 percent rise in the All-Share index.
(Reporting by Helen Nyambura and Tiisetso Motsoeneng; Editing
by David Cowell)
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