South African technology group seeing massive potential in India
Thématique :
inde,
sud afrique
Technology group Allied Technologies (Altech) is focused on capitalising on its existing business and strengths, but the company is also looking to further globalise its operations in an effort to continue to increase its foreign revenue.
Speaking at the company’s results presentation last week, CEO Craig Venter said that offshore revenue was expected to reach about R2-billion by year-end, compared with the R1, 6-billion initially projected. Foreign revenue accounted for R800-mil-lion of the company’s total revenue of R4 533-million for the year ended August 31.
“International revenues will increase through our globalisation efforts. Export and foreign revenue have increased steadily since 2005,” said Venter.
The decrease in the operating profit for the multimedia and electronic divisions from R48-million for the six months ended August 31, compared with R59-million for the corresponding period last year, was attributed to the multimedia company Altech UEC gaining access to the Indian market.
However, Venter pointed out that there were opportunities to be capitalised on in the Indian market. “It is important for us as a new entrant in India, where there is significant volumes, to enter at relatively lower margins. “Now that we have accessed the market, UEC is starting to up-sell its products. We are supplying personal video recorders (PVRs) into this market at higher margins, and expect growth in this particular market,” he said.
The successful deployment of satellite set-top boxes in India now represents 21% of the revenue of Altech UEC. The company is in the process of delivering 500 000 decoders to India, and has received an addi- tional order for one-million decoders to be supplied over the next 12 months.
“The potential orders in India are amazing. If we choose the right partners and get the right infrastructure in place, the level of business and numbers to be achieved in India are ‘mind boggl-ing’,” said COO Andy Baker.
The company’s strong performance was also attributed to its annuity revenue, which accounted for 77% of the group’s revenue for the year ended August 31. “Altech has weathered the storm and is quite robust in this difficult economic climate. We are in a good position, and believe that our annuity revenue will increase into the future,” he said.
Meanwhile, public data network operator in East Africa Kenya Data Networks (KDN), in which Altech has a 51% controlling interest, has acquired 10% of the East African Marine Systems (Teams) undersea fibre-optic cable network, fronted by the Kenyan government, America’s Seacom and the India-based Reliance Consortium.
This results in an 8,5% interest in the project valued at $11-million. Venter said that this was aimed at linking East African operations of Rwanda, Tanzania, Kenya and Uganda through an intercountry fibre-optic network, which would be linked to the Teams undersea cable network. “This will give us the bandwidth we require, and allow East Africa to move away from satellite communications, which is slow and expensive,” said Venter.
The company has laid 2 500 km of duct-it fibre from Mombasa to the Ugandan border, and in the cities of Nairobi, Mombasa and Kisumu. About 7 km of fibre is laid each day using labour-intensive methods. Venter said that this roll-out was being equally met by demand.
The group aims to capitalise on the position in the East African broadband and value-added network services space, and increase its presence in the South African broadband space.
Revenue increased by 13%, to R4,5-billion, operating profit increased by 34%, to R409-million, and headline earnings a share increased by 19%, to 261c. The telecommunications division contributed extensively to the group’s interim results.
Meanwhile, in South Africa, Altech has opposed the appeal made by the Minister of Com-munications, Ivy Matsepe-Casaburri, against the decision of the South African High Court, which ruled in favour of Altech Autopage Cellular’s entitlement to have its existing value-added network services (Vans) licence converted to an individual electronic communications network service (I-ECNS) licence.
The case started in April this year, when Altech sought an urgent interdict to prevent the publication of the new ECNS, based on its belief that the Minister had acted unconstitutionally by directing Icasa to issue I-ECNS licences to only some Vans licensees.
Venter said, “I cannot tell you that Altech will build a network with the licence nor can I tell you that we are not going to build the network. “It is an Altech board decision – this is big capital expenditure. But we have received our licence.”
However, he said that the tele-communcations market needed consolidation, and that there was a scarcity of frequency in the South African market.
Speaking at the company’s results presentation last week, CEO Craig Venter said that offshore revenue was expected to reach about R2-billion by year-end, compared with the R1, 6-billion initially projected. Foreign revenue accounted for R800-mil-lion of the company’s total revenue of R4 533-million for the year ended August 31.
“International revenues will increase through our globalisation efforts. Export and foreign revenue have increased steadily since 2005,” said Venter.
The decrease in the operating profit for the multimedia and electronic divisions from R48-million for the six months ended August 31, compared with R59-million for the corresponding period last year, was attributed to the multimedia company Altech UEC gaining access to the Indian market.
However, Venter pointed out that there were opportunities to be capitalised on in the Indian market. “It is important for us as a new entrant in India, where there is significant volumes, to enter at relatively lower margins. “Now that we have accessed the market, UEC is starting to up-sell its products. We are supplying personal video recorders (PVRs) into this market at higher margins, and expect growth in this particular market,” he said.
The successful deployment of satellite set-top boxes in India now represents 21% of the revenue of Altech UEC. The company is in the process of delivering 500 000 decoders to India, and has received an addi- tional order for one-million decoders to be supplied over the next 12 months.
“The potential orders in India are amazing. If we choose the right partners and get the right infrastructure in place, the level of business and numbers to be achieved in India are ‘mind boggl-ing’,” said COO Andy Baker.
The company’s strong performance was also attributed to its annuity revenue, which accounted for 77% of the group’s revenue for the year ended August 31. “Altech has weathered the storm and is quite robust in this difficult economic climate. We are in a good position, and believe that our annuity revenue will increase into the future,” he said.
Meanwhile, public data network operator in East Africa Kenya Data Networks (KDN), in which Altech has a 51% controlling interest, has acquired 10% of the East African Marine Systems (Teams) undersea fibre-optic cable network, fronted by the Kenyan government, America’s Seacom and the India-based Reliance Consortium.
This results in an 8,5% interest in the project valued at $11-million. Venter said that this was aimed at linking East African operations of Rwanda, Tanzania, Kenya and Uganda through an intercountry fibre-optic network, which would be linked to the Teams undersea cable network. “This will give us the bandwidth we require, and allow East Africa to move away from satellite communications, which is slow and expensive,” said Venter.
The company has laid 2 500 km of duct-it fibre from Mombasa to the Ugandan border, and in the cities of Nairobi, Mombasa and Kisumu. About 7 km of fibre is laid each day using labour-intensive methods. Venter said that this roll-out was being equally met by demand.
The group aims to capitalise on the position in the East African broadband and value-added network services space, and increase its presence in the South African broadband space.
Revenue increased by 13%, to R4,5-billion, operating profit increased by 34%, to R409-million, and headline earnings a share increased by 19%, to 261c. The telecommunications division contributed extensively to the group’s interim results.
Meanwhile, in South Africa, Altech has opposed the appeal made by the Minister of Com-munications, Ivy Matsepe-Casaburri, against the decision of the South African High Court, which ruled in favour of Altech Autopage Cellular’s entitlement to have its existing value-added network services (Vans) licence converted to an individual electronic communications network service (I-ECNS) licence.
The case started in April this year, when Altech sought an urgent interdict to prevent the publication of the new ECNS, based on its belief that the Minister had acted unconstitutionally by directing Icasa to issue I-ECNS licences to only some Vans licensees.
Venter said, “I cannot tell you that Altech will build a network with the licence nor can I tell you that we are not going to build the network. “It is an Altech board decision – this is big capital expenditure. But we have received our licence.”
However, he said that the tele-communcations market needed consolidation, and that there was a scarcity of frequency in the South African market.
