Making the announcement at the company’s annual results presentation, Mr. Mboweni said: "I am pleased to announce that we have secured the resources, through our parent company, Econet Wireless Group (EWG), to expand capacity further, from the current 2,5m expansion program, to go to 5 million."
Currently, Econet has a connected capacity of about 1.2 million and expects that number to exceed two million by the end of this year.
He said that at the beginning of the year, group chairman Mr. Strive Masiyiwa had put in place a task force to mobilise resources for the expansion of the Zimbabwe network. The task force comprises executives from the head office, as well as the local company. Mr Mboweni said the team which has traveled around the world has had "spectacular success", and they are now turning away some funders, as they now want to focus on implementing what they have.
Meanwhile, at the results presentation, Mr Mboweni said Econet has returned to its core business of telecommunications, following the dollarisation and the end of sub-economical tariffs. "As you all know, the hyperinflation caused us to focus on investment activities in order to keep the business alive, but now we are back to our core business," he said.
Whilst this time last year Econet Wireless’ income came almost exclusively from investments, the income statement this year has almost no investment income. The revenue for the year was $87.9 million, and the earnings before interest, depreciation, tax, and armortisation was $26.6 million, or 30% of revenue.
The company re-valued its assets in US dollars, showing the growth of its balance sheet to have increased to $176.4 million. However the revaluation in the assets resulted in a depreciation charge of $18.4 million, which contributed significantly to a net loss of $2.1 million for the year. Management was not unduly concerned with this number, given the turmoil in the first 10 months of trading. Finance Director, Mr Kris Chirairo, said it was clear that Econet was one of the first large companies to fully dollarize, adding that the company was now "doing very well" as would be shown in the half year figures, which would be based on fully dollarized earnings. "It is difficult to imagine there is a stronger public company out there than Econet Wireless at the moment. We are operating at full capacity, and expanding rapidly. Our revenues are strong and growing, and cash flow is very good."
Both Mr Mboweni and Chirairo stressed that there had been a "lot of cleaning up" during the first few months post-dollarisation. The company has paid foreign creditors, and restored normal supply and contractor relationships which had been impaired by lack of access to foreign exchange. Services that had been suspended have all been restored, and new ones have been introduced. The company undertook a major study of salaries in the region of cell phone operators, and is now paying its staff based on that study, as a result the hemorrhaging of staff to other countries has stopped, and many are now coming back to rejoin. Obsolete systems and equipment are being updated, even as the expansion is taking place.
Mr Chirairo said the use of multiple currencies and the collapse of the Zimbabwe dollar had essentially made the accounting process for the first 10 months of the trading year an "academic exercise". He said what was important to the company is what had happened in the last two months when dollar tariffs were introduced.
Those two months contributed almost 32% of the total revenue realized, despite the early challenges of implementing a new USD distribution system for its products, which had been hampered by the requirement for licensing of dealers to receive payment in US dollars.
Mr Chirairo said that beyond the two months, revenue continued to grow, but would not state the actual numbers, saying such information would be made available at the half year results in August.
Mr Mboweni said whilst the process of mobilizing funds, placing orders with suppliers for equipment, as well as local construction, created a lead time on delivery of new capacity, the company has now begun to release capacity for pre-paid lines. In the last two months, the company has been selling about 5,000 new lines per day, and expects this to increase dramatically over the months as more and more equipment is received and installed.