Zimbabwe News and Internet Radio

NetOne migrates to new billing system


The State-owned mobile telecommunications services provider embarked on a turnaround strategy two years ago aimed at bringing the company to profitability.

Nkosinathi Ncube, NetOne’s acting chief executive, yesterday said work to migrate to the new billing system commenced at the end of last year, but was delayed for six months due to United States sanctions imposed on the Chinese supplier.

“To complete the transformation pillars, the State-owned mobile operator will this October 2018 launch its most ambitious project, which will entail the scrapping of its antiquated and inefficient billing system, replacing it with a state-of-the-art converged billing and business support system,” he said in a statement.

He added that with the new system, Zimbabwe’s second largest mobile network provider would be able to offer seamless services across all the end-users including pre-paid, post paid and hybrid customers.

The inability of the legacy billing systems to offer promotions and high quality services to individual and corporate contract subscribers has over the past five years robbed NetOne of potential revenue.

“The development will give us an edge to compete effectively in all the customer segments that we have identified for revenue growth,” Ncube said.

The NetOne boss noted that tariff adjustments which were implemented in March 2018 resulted in revenue growth well ahead of 2017.

Ncube said so far in the year, the month of August recorded the highest turnover and year to date profit, anchored by the restructuring which started in 2016.

“The drive in profitability is supported by a robust cost control strategy that is bearing fruit and continues to be expanded. A healthy EBITDA of 36 percent in August 2018 is ahead of painstaking surgery by the entire NetOne team in the last three years,” he said.

Meanwhile, Ncube said the transformation process saw the company accruing more that $25 million in unpaid legacy costs which the company paid off.

“After overhauling business processes and systems in 2016, management was confronted with unpaid legacy costs of non-compliance relative to statutory obligations, irregular contracts and abrogation of basic procurement regulations.

“This led to once off payments in penalties and interest payments of more that $25 million out of the 2017 revenue. Significant exchange rate losses on the Chinese loans also negatively impacted the 2017 results,” he said.

Ncube said NetOne has also taken advantage of the tax amnesty by clearing legacy tax exposures amounting to around $13 million emanating from the year 2015 and years prior to that.

“This has resulted in write backs of $4 million contributing to current return to profitability in 2018,” he said.

Between 2013 and 2016, NetOne benefitted from government guaranteed loans from China Eximbank of more than $285 million with the capital deployed towards expanding and modernising the network. Daily News.