South Africa’s Cell C Turnaround Strategy Bearing Fruit

CELL C’s turnaround strategy of focusing on more profitable customers is “bearing fruit” and the business is stabilising, the South African mobile operator said on Tuesday as it reported a wider annual net loss on impairments and one-off costs.

Cell C, in which telecoms firm Blue Label (BLUJ.J) owns a 45% stake, is in the middle of a turnaround plan that involves recapitalising its operations to improve liquidity and its debt profile, and reworking its network strategy.

It is courting more profitable subscribers rather than pushing to increase the size of its user base after previous cut-price deals failed to attract regular, long-term users of its services.

“The foundations are now in place,” Cell C’s Chief Financial Officer Zaf Mahomed said.

Annualised average revenue per user (ARPU) from prepaid customers, its largest subscriber base, rose by 28% in the year ended Dec.31.

After shedding 15% of its prepaid subscriber base,