TNM Returns to Profitability, Forecasts MK2.3 Billion First-Half Earnings
Market analyst Dr. Saidi Jackson sees this as a positive sign for TNM's financial performance, suggesting a possible return to full profitability by the end of 2024.
BLANTYRE, Malawi - Telekom Networks Malawi Plc (TNM), the Malawian-owned telecommunications company listed on the Malawi Stock Exchange (MSE), expects a significant boost in profitability for the first half of 2024, forecasting a net profit of between MK2.192 billion and MK2.35 billion, writes AfricaBrief Reporter.
This represents a 181% to 201% increase compared to the same period last year, marking a return to solid profitability after a challenging period characterized by economic volatility.
In its annual report for 2023, TNM attributed its losses to a challenging macroeconomic environment marked by devaluations, high interest rates, and inflation exceeding 30%.
"After further reviews, profit after tax for the half-year ending June 30, 2024 is expected to be between MK2.192 billion and MK2.350 billion due to improvements in revenue," reads the trading statement signed by Company Secretary Chisomo Governor.
Market analyst Dr. Saidi Jackson sees this as a positive sign for TNM's financial performance, suggesting a possible return to full profitability by the end of 2024.
"They have scrapped through the most difficult period when the Malawi economy experienced sustained volatilities and shocks," Jackson said.
"With some economic fundamentals such as the exchange rate, inflation and energy supplies now stabilizing, TNM has the potential to return to total profitability by end of the year."
Jackson, an independent business management analyst and former senior lecturer at UNICAF University Malawi, attributes TNM's potential to a projected surge in demand for mobile internet and digital financial services.
"TNM has a more resilient and stable mobile internet service, according to surveys by MACRA," Jackson said.
"If they can stay the course with their innovations such as 5G and fintech solutions like Mpamba, TNM will be able to narrate a more positive profit story by end of year."
He added that the upcoming 2025 electioneering season, with increased demand for mobile internet and communication services, could further boost TNM's Mpamba mobile money business.