MTN posts Shs229 billion profit
KAMPALA - MTN Uganda has announced an 11 per cent rise in profit for 2014, on the back of growth in data and mobile money revenues.
The telecom company posted a net profit of Shs229 billion in 2014, up from Shs203 billion in 2013, the CEO Mr Brian Gouldie, revealed at a media briefing held in Kampala yesterday.
Before expenses and taxes are deducted, the company recorded revenues of Shs1.3trillion.
Mr Gouldie told also reporters that the voice segment of the market had continued to remain flat in terms of revenue.
“The voice revenues remain flat because this segment remains highly competitive among the eight operators in the country,” he said.
Talking to Daily Monitor on the sidelines of the briefing, Mr Gouldie noted that prices of voice had dropped during the period which resulted into falling revenues for the segment.
“As the market matures, voice growth slows down and the trend we have noticed is that more calls are being made by Ugandans but because prices dropped our return has reduced,” he said.
According to the financial statement, of the total revenue, data contributed Shs322 billion. In this week’s Prosper Magazine, in the Daily Monitor, Vodafone, a new player in Uganda’s telecom market, noted that data provides higher price points for operators.
This explains the increased marketing and subscriptions. It is estimated that 80 percent of all internet subscribers in Uganda use mobile handsets to access the internet.
This further explains investment by MTN in adding more 3G internet sites. In 2014, MTN spent at least Shs94bn on data infrastructure.
In 2015, the company plans to spend an additional Shs138 billion on upgrading data infrastructure.
Mr Gouldie did admit that the company faced challenges on data bundle subscriptions last year but was quick to point out that those glitches had been sorted.
The telecom also announced that subscriber numbers had increased to 10.4 million Ugandans, which it attributed voice bundles, improved 3G coverage and increased take up of MTN Mobile Money. Mobile is second largest revenue stream for the company.
“Mobile Money has been stabilised after we completed a Shs14billion upgrade of the system. This ensured stability and security of Mobile Money financial services,” Mr Gouldie said.
Mobile money transactions have been in the spotlight as Bank of Uganda moves a step to having regulations.
Meanwhile, the company announced it has acquired land where it will build its own offices and do away with rental expenses.
Source: Daily Monitor
Weakening shilling could spur inflation rise
Kampala- The persistent weakening of the shilling against the dollar might drive up inflation if Bank of Uganda does not take immediate action to arrest the decline, a currency analyst has said.
Mr Stephen Kaboyo, Alpha Capital Partners managing director, told Daily Monitor in an interview yesterday that the current currency depreciation pressures are unlikely to ease off in the short term because of Uganda’s widening trade imbalance, necessitating that the Central Bank takes action to contain the depreciation before it filters into inflation.
By 9am yesterday, commercial banks and forex traders quoted the shilling at an average of 2,700/2,750 per dollar buying and selling, respectively up from last week’s average of Shs2,600/2,620 per dollar buying and selling, respectively.
The weakening of the local unit against the dollar means traders need more shillings to buy a dollar, which increases operational costs from higher import prices. This, in turn, increases inflation because of its spillover effects.
Uganda’s annual headline inflation declined to 1.4 per cent in September 2014, from the 2.8 per cent recorded in August while core inflation – which excludes the often volatile food crops, fuel, electricity and metered water prices – stands at 2 per cent down from 3.1 over the period under review.
Mr Kaboyo added that demand for the dollar has stayed high amid reduced inflows, further exerting pressure on the local currency.
Under the current market conditions, he added, the shilling is poised to touch further lows due to lack of strong fundamentals, primarily the current account deficit.
The Central Bank State of the Economy report for August states that Uganda’s trade balance continues to deteriorate on account of stagnant exports and high import requirements.
According to the report, Uganda’s trade deficit fell by 11.4 per cent, implying that total trade deficit stood at $2.123 billion (about Shs550.918 trillion) in 2012/13.
However, in the financial year 2013/14, the deficit rose to $2.365 billion (about Shs613.717 trillion).
This has continued to mount pressure on the local unit as a result.
The shilling last suffered huge depreciation rates in October 2011 when it touched Shs2,900 per dollar in almost two decades.
Predictions about the economy
Mr David Cowan, a Citibank Africa economist also said in ‘Uganda: The economy regains momentum into 2014’ that Uganda’s widening current account deficit was expected to weaken the performance of the shilling against major trading currencies.
He says the country’s current account deficit is expected to stand at 14.8 per cent in 2014, up from 10.9 per cent in 2012 due to modest growth in exports against a high import bill, mainly from imports of capital goods for major investment projects in the oil and gas sector.
Source: monitor.co.ug
Microsoft profits beat expectations despite Nokia drag
Microsoft has reported a fall in profits as a result of costs related to job cuts and its purchase of Nokia's smartphone business earlier this year.
The software giant made $4.5bn (£2.8bn) in the three months to September, 13% lower than the same time last year.
"Integrations and restructuring expenses" cost $1.1bn, Microsoft said.
But the new Nokia business also boosted revenues. They climbed 25% to $23.2bn, beating expectations and sending shares higher in after-hours trading.
Cost cutting
In July Microsoft announced plans to cut 18,000 jobs, including 12,500 in the Nokia unit it bought in April.
On Wednesday Microsoft said it would no longer use the Nokia name, selling future Lumia smartphone models as Microsoft-branded phones. ,Microsoft boss Satya Nadella said the company was being "positioned for future growth".
"Our teams are delivering on our core focus of reinventing productivity and creating platforms that empower every individual and organisation," he said.
Microsoft makes most of its money selling software to companies. The results show a strong growth in its business selling cloud computing to companies - an area Mr Nadella has cited as important for the future of Microsoft.
But the business has continued to place great importance on its consumer products like the Xbox games console, its Surface range of tablet computers, and smartphones.
Stronger sales of phones and tablets helped boost revenues, with total consumer revenue up 47%.
Awesomness has new dimensions
The year-long wait has ended. Apple has unveiled not just one but two iPhones with bigger displays and faster processors. Here is what makes the iPhone 6 and iPhone 6 Plus special. A 4.7-inch screen with 1334 X 750 pixel resolution display, encased in an all-aluminium 6.8 mm slim chassis with a powerful A8, 64-bit chipset of brain. With ion-strengthened glass front, the curvature design aesthetic follows to the aluminium back that sports a stainless steel Apple. This is the iPhone 6 for you. The bigger sibling encases a 5.5-inch display that marks Apple 's entry into the phablet space. The display has 1980 x 1080 pixel resolution in a 7.1mm thick chassis. The back is made of anodized aluminium and also has a stainless steel frame. The awesomeness of dimensions is extended to the innards too. The all new A8, 64-bit second-generation chipset is accompanied with the M8 co-processor. Apple claims that the A8, 64-bit chip is 25 per cent more powerful than its predecessor and offers 50 per cent faster graphics. The company promises that the A8 chipset would allow the device to run at full power without causing heat. The battery life is estimated at 15 hours of 3G talk time on the iPhone 6 and 24 hours on the iPhone 6 Plus. While the megapixel count remains the same, both the iPhones have a new iSight sensor and both also support a faster auto focus. The iPhone 6 features a digital image stabilisation while the iPhone 6 Plus has an optical image stabilisation. Apple also says it's now capable of capturing 1080p video at 30 or 60 frames per second, and Slo-Mo video at 240 frames per second. Panoramas have been increased to up to 43 megapixels. In addition, the iPhones have got the NFC chips too for Apple Pay. This is the new payment service where payments can be made with the phone instead of the credit card at checkout counters. This makes the two iPhones unique. Of course, this service will first be available only in the US with no security threats as the credit card numbers are stored in the Passbook app. Neither Apple nor the retailer will have access to that information. Irrespective of the bigger display, Apple has still made both the phones user friendly by introducing a new gesture called "Reachability," to account for the increased screen size of the devices. Double touching the home button will slide down the entire display, making the top software buttons accessible in whatever app you're in. The 5.5-inch iPhone 6 Plus also allows apps to show more information. For instance, in landscape mode, the Mail app will show both a list view of messages on the left side and the content of the selected message to the right, similar to how it is displayed on Apple's iPad Air and iPad Mini. PLENTY TO LOOK FORWARD While Samsung and Sony unveiled new products at the IFA Berlin trade show, Apple came out with its new iPhones. And Blackberry is catching up with its Passport. Many smartphones announced globally will be launched in India in October. We take a look.
Africa regional trade increases
Kampala. Intra-regional trade between the East African Community (EAC), Common Market for Eastern and Southern Africa (Comesa) and the Southern African Development Community (SADC) has grown threefold in a period of 10 years.
Latest statistics show the combined intra-trade of the three regional economic communities (RECs) for the period 2004 to 2014 grew from $30 billion (about Shs87 trillion) to $102.6 billion (about Shs289.7 trillion).
In this period, Comesa alone recorded growth from $8 billion (about Shs23.2 trillion) to $22 billion (about Shs63.8 trillion). Comesa is made up of Uganda, Kenya, Rwanda, Burundi, the Democratic Republic of Congo, Eritrea, Ethiopia, Egypt, Sudan, Comoros, Djibouti, Libya, Madagascar, Malawi, Mauritius, Seychelles, Swaziland, Zambia and Zimbabwe.
SADC, on the other hand, registered growth from $20 billion (about Shs58 trillion) to $72 billion (about Shs208.8 trillion). SADC is made of South Africa, Botswana, Lesotho, Namibia, Swaziland Mauritius, Zimbabwe, Madagascar, Malawi, Mozambique, Tanzania, and Zambia
EAC saw its growth in trade grow from $2.6 billion (about Shs7.5 trillion) in 2004 up to $8.6 billion (about Shs24.9 trillion) realised in 2014. Uganda, Kenya, Tanzania, Rwanda and Burundi make up the EAC.
Giving an update on the Tripartite Free Trade Area negotiations, the Secretary General of the Common Market for Eastern and Southern Africa (Comesa), Mr Sindiso Ngwenya, said: “This growth has taken place on the basis of the individual free trade areas (FTAs) of the three RECs”.
Mr Ngwenya said the establishment of the Comesa-EAC-SADC free trade area will follow the same growth path, however at an accelerated growth pace and, supported by infrastructure and industrialisation programmes.
He proposed for the initiation of negotiations for the establishment of a free trade area between the Tripartite (Comesa-EAC-SADC) on one hand, and the Economic Community of West African States (Ecowas).
“Once this is achieved we shall then focus on the establishment of the African Union continental free trade area,” Mr Ngwenya added.
Source: Daily Monitor
Government to re-table draft law on counterfeits
Kampala- The Anti-Counterfeit Bill will be re-tabled after the government failed to reach a consensus on which institution will take charge of enforcement, the trade minister, Ms Amelia Kyambadde has disclosed.
The regulation, also known as Anti-Counterfeiting Bill, has been in Parliament for years as the business community continues face the consequences of the vice.
According to the bill, “Counterfeiting” means without the authority of the owner of a copyright or trademark.
Speaking at a breakfast meeting with the British Business community here earlier in the week, trade minister Amelia Kyambadde said the Anti-Counterfeit Bill will be re-tabled in Parliament before the end of July.
She said: “We had issues with the anti-counterfeit Bill. We failed to reach a consensus on enforcement and so we were forced to withdraw it.”
She continued: “But we have agreed that police will now do the enforcement and not us. By July, we hope that we would have re-tabled and implementation will start a month after that.”
A statement from the ministry indicated that the bill was withdrawn from parliament in 2013. However it has since been redrafted with amendments as recommended by some Members of Parliament and other stakeholders.
Before the bill was withdrawn there was a disagreement on who should take charge of enforcement, According to the trade ministry statement some legislators argued that the ministry did not have enough manpower and capacity to effectively enforce the Act.
“The draft bill is ready and preparations are underway to table it before Cabinet for approval, and later re-table it before parliament,” reads the statement.
Ms Kyambadde’s response was prompted by the calls from the British Business Community in Uganda to expedite the Anti-Counterfeit Bill.
Uganda Breweries Limited corporate relations and legal director Charity Kiyemba observed that the absence of a law on counterfeits has exposed British companies in Uganda to unfair competition, hence a big threat to their investments.
Other issues raised by the British companies operating in Uganda, which they expect government to address, include; delays at Entebbe airport caused by limited manpower, bureaucracies at several levels of clearing goods at the ports, licensing of foreign companies and the high income tax levied on them.
About the law
The proposed law seeks to prohibit trade in counterfeit goods that infringe upon protected intellectual property rights; to require intellectual property rights to cover only copyright and trademarks and to prohibit release of counterfeit goods into the channels of commerce.
It also seeks to create offences relating to trade in counterfeit goods, empower the Commissioner General to seize and detain suspected counterfeit goods, allow inspectors appointed by the Uganda National Bureau of Standards to seize and detain suspected counterfeit goods and to provide for incidental (related) matters.
Source: Daily Monitor
Wrist action: phone firms bet on 'year of smartwatch'
Defying scepticism and geek-stigma, mobile phone firms are determined this year to sell you a wristwatch wirelessly connected to your mobile phone.
Numerous models have hit the market over the past year but 2015 will see an explosion, analysts say, with manufacturers making their watches and other wearable connected devices more elegant and useful.
US giant Apple (NasdaqGS: AAPL - news) 's release of its first "smartwatch" -- expected by April -- is set to make 2015 a "tipping point for wearables", research group CCS Insight said in a report.
In anticipation of that launch, Apple's Asian rivals scrambled to unveil their own connected wrist gadgets in Barcelona on Sunday on the eve of the World Mobile Congress trade show in Barcelona.
South Korean manufacturer LG (KSE: 003550.KS - news) released the Urbane LTE, its first fully connected luxury wristwatch that can make and receive calls -- either with a wireless headset, or by speaking into your wrist like the comic book detective Dick Tracy.
Unlike most smartwatch models, the chunky Urbane LTE version has its own network SIM card with a mobile connection and so can be used for calls, without needing to be linked to a smartphone.
Chinese telecom giant Huawei also unveiled a deluxe smartwatch: a round stainless steel creation that it says can receive text messages, email and call notifications as well as monitoring your heart rate and calories burned.
The industry is watching keenly to see whether smartwatches will be the first mobile phone-linked "wearables" to really take off in the mass market -- a tough call, according to analysts.
"In the end-user research that we've done, we asked people what a smartwatch is for and they had no idea," said Ben Wood, head of research at CCS Insight.
Technology and fashion
With the big phone companies piling in alongside smaller smartwatch specialists such as Pebble, fashion brands are doing their bit to try to design a more desirable product.
Several Swiss watchmakers and fashion brands such as Guess have unveiled designs, while jeweller Swarovski has encrusted smartwatches with its crystals for a deluxe look.
"The vast majority of smartwatches on the market are bulky and look more like a piece of technology than a fashion item," however, said Kevin Curran, a telecom specialist at the University of Ulster.
"That's going to change as companies focus more on design and making devices that are more discreet."
With their new circular watches, LG and Huawei positioned themselves at the luxury end of the market, differentiating themselves from the square-faced design revealed in previews by Apple.
"We set out to create smartwatches that could contend for a spot on your wrist with a luxury mechanical watch," said LG's head for Britain and Ireland (Other OTC: IRLD - news) , Andrew Coughlin.
Source: Daily Monitor
TV star sacked for saying Michelle Obama looked like Planet of the Apes character
A Spanish-language American television network announced on Thursday it had fired a presenter for comments in which he likened Michelle Obama, the US First Lady, to a character in the film Planet of the Apes.
Rodner Figueroa made the remark during an appearance on the popular talk show El Gordo y La Flaca a day earlier while discussing the work of a make-up artist who copies the looks of famous people.
"Look, you know that Michelle Obama looks like she's part of the cast of the film Planet of the Apes," said Mr Figueroa in Spanish.
The comparison quickly drew accusations of racism.
"Rodner Figueroa made comments regarding Lirst Lady Michelle Obama that were completely reprehensible and in no way reflect Univision's values or views," the Miami-based Univsion network said in a statement.
"As a result, Mr Figueroa was immediately terminated."
Mr Figueroa had served as a fashion expert on Univision, among other roles, and he was seated next to the two main hosts of the show Raul De Molina and Lili Estefan when he made the remark.
Ms Estefan responded with, "What are you saying?" and Mr De Molina interjected to say that Michelle Obama was attractive.
Mr Figueroa, in an open letter to the First Lady posted on the website Latin World Entertainment, wrote in Spanish that his comments were not directed at Michelle Obama but toward the make-up artist who had sought to replicate her look.
"I feel mortified, and I ask for your forgiveness, because there is no excuse for a professional like myself to make a comment like that which can be interpreted as offensive and racist in these volatile times that our country is experiencing," he wrote.
Source: Daily Monitor
EAC governments raise taxes to curb gambling addiction
Kampala. East African governments have renewed efforts to bring the betting industry under strict control amid claims of tax evasion and fears of a growing gambling culture and addition among the youth, who are mostly unemployed.
Kenya and Uganda have moved to vet industry players with threats of revocation of licences to tame the proliferation of betting, gaming and gambling outlets.
Despite imposing a punitive tax regimes, restricting the importation of gaming devices and impounding and burning gambling machines, the sector has continued to record growth.
Uganda levies a 35 per cent tax on betting, while in Kenya, the same was reduced to 15 per cent after lobbying by sector players.
While both countries have resorted to drastic measures to contain a sector that has largely become a social and economic menace, Tanzania enacted a strong regulatory framework through the Gaming Act, 2003.
In the 2017/18 financial year, Tanzania collected $36 million from gaming and betting.
But religious leaders recently lobbied President John Magufuli to ban betting altogether to control addiction among the youth.
Suspension
Just this week, Kenya announced that licences for all betting agencies stand suspended as from July 1, and that their renewal will be subject to proof that the companies are tax compliant.
President Museveni recently directed the Ministry of Finance to stop licencing sports betting, gaming and gambling companies due to the negative effects the industry is having on the youth.
Growing numbers
A recent GeoPoll rapid survey carried out among youth between the ages of 17 and35 in Kenya, Uganda, Tanzania, Ghana, Nigeria and South Africa show that millennials in sub-Saharan Africa spend $50 monthly on betting through their mobile phones.
Source: Daily Monitor
Samsung seeks smartphone revamp to arrest profit slide
Samsung Electronics Co Ltd (005930.KS) on Thursday said it would revamp its smartphone line-up to take on competitors in the rapidly growing mid-to-low range segment, after third-quarter earnings set it on course for its worst year since 2011.
The global smartphone leader's market share declined in annual terms for the third straight quarter in July-September, lagging Apple Inc (AAPL.O) in the premium market and overtaken by rivals like Lenovo Group Ltd (0992.HK) and Xiaomi Inc at the bottom end, research firm Strategy Analytics said.
Executives said the South Korean giant would overhaul its lower-tier line-up to boost price competitiveness and use higher-quality components to set its devices apart, after it announced its worst third-quarter profit in more than three years.
"The mid-to-low end market is growing rapidly, and we plan to respond actively in order to capitalise on that growth," Samsung Senior Vice President Kim Hyun-joon said during a conference call with analysts.
Samsung said its third-quarter operating profit fell by an annual 60.1 percent to 4.1 trillion won ($3.9 billion), matching its guidance issued earlier this month.
While the company expects profits to pick up in the fourth quarter on strong demand for televisions and memory chips, analysts still expect Samsung to record its worst annual operating profit in three years.
Profit for the mobile division fell 73.9 percent to 1.75 trillion won in the third quarter, its worst performance since the second quarter of 2011.
Samsung spent most of the quarter without launching a new flagship device, and continued to struggle in the mid-to-low tier markets against cheaper and value-packed offerings like Xiaomi's Redmi 1S.
Robert Yi, Samsung's head of investor relations, said the firm would launch new mid-tier models in the fourth quarter, although he didn't specify what features they would have.
Samsung expects average selling prices for handsets will rise in the fourth quarter due to an increase in premium smartphone sales, namely of the Galaxy Note 4, and as demand picks up in the holiday shopping season.
Analysts say Samsung will likely have to sacrifice margins to protect its market share. Cheaper phones are expected to drive global smartphone market growth in coming years, meaning a general trend of lower average selling prices.
Samsung's chips division was a bright spot, recording a 2.26 trillion operating profit for the July-September quarter to mark the highest earnings since the third quarter of 2010.
