The ICT sector has recorded a massive revenue growth in the balance sheet, but it must not be proudly celebrated since its mainly driven by inflation not just profitability.
The first quarter of 2020 period was characterized by growth in revenue
generated by the mobile telephone networks which grew by
26.2% to record $2.1 billion from $1.65 billion recorded in the fourth quarter of 2019 revealed a Potraz sector report
While the revenue figures looked very healthy, the mobile network operating costs grew by 46.1% to record $1.4 billion from $988.2 million recorded in the previous quarter.
The costs of operation recorded more than a 100% increase in the negative of the 26% increase of revenue from the past period which is in fact a red light the sector must be worried about.
The figure is expected to double in the next quartely report as prices have been chasing inflation while revenue generation has been very slow with cost price failing to meet up with the inflationary environment.
IAP revenues grew by 49.6% to record $754.3 million from $504.1 million; operating costs by IAPs also grew by 80% to record $749.4 million from $416.3 million.
Fixed telephone revenue by TelOne grew by 23.6% to record $308.9million in the first quarter of 2020 from $250 millio recorded in the fourth quarter of 2019.
Operating costs by the fixed network also grew by 4.7% to record $249.2 million from $228.5 million recorded in the previous quarter