Altech yields 34% profit increase

Allied Technologies (Altech) recorded a 34% increase in half year operating profits for the period ended Aug. 31.

The company's continued strong balance sheet and net asset value underpinned the group's expansion strategy, with notable progress in several areas, particularly in Africa, said Altech CEO Craig Venter.

Altech recorded a 13% increase in revenue to 4.5 billion South African rand ($540.9 million) and expanded its African operations through the acquisition of Sameer ICT Group, whose subsidiaries include Kenya Data Networks, Swift Kenya and Infocom Uganda.

"The investment in Sameer ICT Group has placed Altech East Africa as the leading data operator in the region and has supported Altech's globalization strategy, in particular, our focus on the African continent," Venter said.

Meanwhile, Altech NamITech West Africa increased its production to over 100 million prepaid cellular vouchers per month, servicing all five major operators in the Nigerian market, Venter noted.

"One of the key developments of the period was the ruling by the Pretoria High Court on the 29th of August in favor of Altech, entitling the group to have its existing valued-added network services license converted into an individual electronic communications network service license," he added.

Altech's South African telecommunications division was credited with contributing extensively to the group's interim results, having exceeded far beyond the expected profit targets that emanated from various transactions and partnerships.

Venter singled out Altech Autopage Cellular's recent distribution agreement with Neotel, as well as the recent partnership with Kulula airline, as fitting perfectly with the company's business strategy.

While Altech has invested in various sectors, Venter said the IT division contributed substantially to the group's overall performance and that the group's investments in both East and West Africa were proving to be exceptionally profitable.

Through Sameer ICT Group, Altech is positioned to capitalize on international connectivity via TEAMS (The East African Marine System) cable, which is expected to land in June 2009. Altech has secured a 10% equity stake in the Kenyan government-backed undersea fiber-optic cable initiative.

Altech projects an increased growth in the next half year because of the liberalization and deregulation of the telecommunications sector in various countries.

The IDG News Service is a Network World affiliate.