JSE-listed telecommunications group Telkom on Friday reported a 73.2% decline in headline earnings for the year ended March 2013, as legal matters and voluntary retrenchment payouts weighed on the group’s results.

The group recorded headline earnings of 87c, compared with the 310.8c recorded for the year ended March 2012, as the group provided for legal matters, including a R592-million Competition Commission fine, and R434-million for voluntary severance packages.

The headline earnings were not impacted by the group’s R12-billion impairment of its legacy assets, which contributed to the basic loss a share of R22.76 during the year under review, down from a basic loss a share of 42.3c in the prior year.

The group reported a total comprehensive loss for the year of R11.7-billion, compared with the loss of R78-million in the prior year.

However, excluding the impairment, Telkom recorded an after-tax profit of R501-million and earnings before interest, tax, depreciation and amortisation (Ebitda) of R7.1-billion. The group’s Ebitda margin also decreased from 25.8%, to 21.9%.

Telkom’s group revenue had fallen slightly to R33.1-billion, from R33.6-billion in 2012, owing to a 4.7% decline, to R16.3-billion, in fixed voice revenue.

The telecommunications group reported a 3.6% rise in fixed-line data revenue to R10.4-billion, as well as a 22.7% increase in mobile revenue to R1.3-billion, and a 123.3% increase in mobile data revenue to R364-million.

Group operating expenses increased by 40.6%, to R43.9-billion, during the 2013 financial year, on the back of the impairment, fines, voluntary retrenchment packages and increased wages.

However, the decrease in mobile termination rates and a previous R569-million iWayAfrica impairment in 2012 had partially offset expenses.

Telkom noted that the group’s net debt decreased by 46% to R2.1-billion, while generating free cash flow of R2.1-billion – an 18.6% increase from the previous year.

For the second year, Telkom decided not to declare a dividend for the year.