Blue Label in favourable trading update

DURBAN – Blue Label Telecoms share price rose by almost 10 percent on the JSE yesterday after the mobile technology company released a favourable trading update for the year to end May, with earnings expected to surge by more than 20 percent.

Blue Label expects its earnings to improve compared to last year’s losses of 727.81 cents a share, a headline loss of 312.49c as well as 304.77c on its core headline loss. 

Last year the group took a massive hit due to Cell C’s trading losses, impairment of its property, plant and equipment, the impact of a derecognition of its deferred tax asset and the consequent impairment of Blue Label’s total investment.

Blue Label also warned yesterday that it expected its results to be offset by the closures of  its WiConnect retail stores as a result of continued losses incurred on a monthly basis.

“While management had implemented a turnaround strategy at WiConnect, which incorporated the strengthening of the retail management team, a refocus of product sales as well as negotiating additional rebates from the network operators and original equipment manufacturers, Covid-19 had a significant negative impact on the retail operations of WiConnect,” the group said.