Ma­jor­i­ty state-owned telecom­mu­ni­ca­tions com­pa­ny, TSTT, yes­ter­day re­port­ed af­ter-tax prof­it of $95.2 mil­lion (US$14 mil­lion) for its fi­nan­cial year end­ing March 31, 2023.

The af­ter-tax prof­it for the 2023 fi­nan­cial year fol­lowed five years dur­ing which TSTT re­port­ed loss­es. Be­fore 2023, the last fi­nan­cial year the com­pa­ny was prof­itable was 2017, when TSTT de­clared a prof­it of $40.8 mil­lion (US$6 mil­lion).

TSTT re­port­ed its fi­nan­cial po­si­tion at a vir­tu­al in­vestor pre­sen­ta­tion to its bond­hold­ers, fol­low­ing which ex­ec­u­tives of the sup­pli­er of telecom­mu­ni­ca­tions ser­vices to the lo­cal mar­ket took ques­tions from an­a­lysts, rep­re­sen­ta­tives of com­pa­nies hold­ing TSTT’s debt and two lo­cal jour­nal­ists.

TSTT’s turned around an af­ter-tax loss of $244.8 mil­lion (US$36 mil­lion) in its 2022 fi­nan­cial to a prof­it of $95.2 mil­lion in 2023, al­though its rev­enue slipped by 3 per cent to $1.88 bil­lion (US$277 mil­lion) in the just-con­clud­ed fi­nan­cial year from $1.93 bil­lion (US$285 mil­lion) for the pe­ri­od end­ing March 31, 2022.

One of the rea­sons for the turn­around in TSTT’s fi­nan­cial for­tunes was the com­pa­ny’s de­ci­sion to re­trench about 460 em­ploy­ees in a process that end­ed in Ju­ly 2022.

Speak­ing on the is­sue of the com­pa­ny’s re­struc­tur­ing last year, Shi­va Ram­nar­ine, TSTT’s chief fi­nan­cial of­fi­cer, said in un­der­tak­ing its re­struc­tur­ing and trans­for­ma­tion last year, the com­pa­ny strove to im­prove crit­i­cal ra­tios aimed at mea­sur­ing the ef­fec­tive­ness of spend­ing on per­son­nel.

“You would re­call from pre­vi­ous ses­sions that we talked about our per­son­nel to rev­enue ra­tio be­ing sig­nif­i­cant­ly above in­dus­try av­er­age at 24 per cent. Sim­i­lar­ly, main­te­nance cost to rev­enue was sig­nif­i­cant­ly high­er than in­dus­try av­er­age at 18 per cent.

“Post re­struc­tur­ing and trans­for­ma­tion, we are hap­py to re­port that per­son­nel cost is down to 13 per cent, which is ac­tu­al­ly best in class as a per­cent­age of rev­enue. And main­te­nance cost as a per­cent­age of rev­enue is down to 11 per cent.”

He said TSTT start­ed off the con­ver­sa­tion on re­struc­tur­ing to se­cure a $680 mil­lion (US$100) in sav­ings. But on fur­ther re­view, the com­pa­ny land­ed on sav­ings from the re­struc­tur­ing of $476 mil­lion.

Al­so ad­dress­ing bond­hold­ers and jour­nal­ists, TSTT CEO, Lisa Agard, said the com­pa­ny does not per­ceive Star­link, the Elon Musk-owned satel­lite telecom­mu­ni­ca­tions provider, as be­ing a se­ri­ous threat to TSTT be­cause of its high set-up costs.

Ram­nar­ine, ob­served that com­pa­ny’s au­di­tors, EY, placed a ‘go­ing con­cern’ note in com­pa­ny’s ac­counts for the three years be­tween 2020 and 2022. That note would have sig­naled to the TSTT’s stake­hold­ers that there was ma­te­r­i­al un­cer­tain­ty about the com­pa­ny’s fu­ture.

“How­ev­er, our fi­nan­cial per­for­mance and our ad­her­ance to our strate­gic and op­er­at­ing plans have demon­stra­bly shown that TSTT’s cur­rent and fu­ture fi­nan­cial po­si­tion has sig­nif­i­cant­ly im­proved from the prof­itabil­i­ty and cash­flow per­spec­tives,” said Ram­nar­ine, adding, “As a re­sult, I am now ex­treme­ly hap­py to re­port that this note has been re­moved by our au­di­tors for the year end­ing March 31, 2023, so­lid­i­fy­ing our fi­nan­cial vi­a­bil­i­ty and con­ti­nu­ity.”