Malawi Stock Exchange (MSE)–listed TNM plc has described this year’s economic outlook as mixed due to the Covid-19 pandemic which has slowed down business within and abroad.
In an interview on the sidelines of the 25th Annual General Meeting (AGM) on Tuesday, TNM plc board chairperson George Partridge said the global pandemic is causing turmoil to many businesses and the company has not been spared.
He said: “Many businesses are in a suboptimal level in terms of how they are operating and these are our customers, therefore, if our customers are suffering we may be affected by that too.
“We have produced a cautionary statement to our shareholders to say that our profits may be down by around 20 percent this year.”
Partridge, however, said there is a silver lining to the pandemic as the disease has boosted communication.
“A lot of people are now communicating through the Internet, mobile including voice. This is therefore helping us grow the business as a result the impact will not be that bad for us when compared to how other companies are being affected,” he said.
Looking into the future, Partridge said the firm will bank on its set strategies to achieve growth of the business.
He said last year, the company invested $25 million (about K19 billion) in the business and it will make similar investment this year.
In the year-ended December 31 2019, the firm’s overall service revenue increased by three percent from 15 percent in the prior year.
During the period, TNM plc registered a profit after-tax of K15 billion, a 10 percent decrease compared to the previous year’s K16.6 billion due to, among other factors, one-off functional review costs and increase in depreciation expense resulting from investments made in 4G and U900 technology over the past three years.
At the AGM, the board declared a final dividend of K2.5 billion or 25 tambala per share, making a total of K7.5 billion for the year-ended December 31 2019.
One shareholder, Terrence Nsamala, in an interview expressed satisfaction with the performance of the firm, citing payment of dividends which has also been increasing.
Malawi Confederation of Chambers of Commerce and Industry chief executive officer Chancellor Kaferapanjira on Wednesday said the rising cases of Covid-19 paints a gloomy outlook for businesses in the second half of the year.
He said: “Our main risks have been political uncertainty and the Covid-19 pandemic. But now with political uncertainty gone and Covid-19 cases rising, businesses are still struggling to pick-up.”
In its 2020 Malawi Annual Economic Report, Treasury said the economy is projected to lose about K244 billion in nominal gross domestic product (GDP) or 3.5 percent of GDP if the pandemic is contained by the second quarter of the 2020/2021 financial year.