Malawian-owned telco Telekom Networks Malawi Plc (TNM), listed on the Malawi Stock Exchange (MSE) says it expects its net profit for the first half of 2024 to increase by 201% to MK2.35 billion.
TNM said in an updated trading statement published Wednesday that profit after tax for the half year ended June 30, 2024 to be between MK2.192 billion and MK2,35 billion, representing an increase of between 181% to 201%.
“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.
The latest performance reflects a return to solid profitability for the telco as it recovers from cycles of distressed profit trajectory. In its annual report for the financial year ended December 31, 2023 TNM Plc attributed its losses to the challenging macro-economic conditions characterized by devaluations, high interest rates and inflation of over 30%.
A market analyst Dr Saidi Jackson described TNM’s first half net profit forecast as a signal that a return to profitability by the telco is possible by December 31, 2024.
“They have scrapped through the most difficult period when the Malawi economy experienced sustained volatilities and shocks. 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,” he said.
Jackson, who is an independent business management analyst and a former senior lecturer at UNICAF University Malawi said TNM’s potential to wing back to total profit lies in an expected 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. If they can stay the course with their innovations such as 5G and fintech solutions such as Mpamba, TNM will be able to narrate a more positive profit story by end of year,” he said.
He added that with the 2025 electioneering season around the corner, demand for mobile internet services and increased spending for communication could boost TNM’s Mpamba business.
