Directors' report

The Directors have pleasure in submitting their report on the annual financial statements of Blue Label Telecoms Limited (the Company) for the year ended 31 May 2023.


The Company is incorporated and domiciled in the Republic of South Africa. The Company is an investment holding company.

The consolidated annual financial statements of Blue Label Telecoms Limited are available from the Company’s registered office and online from the Company’s website.

There have been no material changes to the nature of the Company’s business from the prior year.


The annual financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and the requirements of the Companies Act, No 71 of 2008. The accounting policies have been applied consistently compared to the prior year.

The operating results and state of affairs of the Company are fully set out in the attached annual financial statements and do not, in our opinion, require any further comment.

The Company recorded a total comprehensive loss for the year ended 31 May 2023 of R253 million (2022: profit of R228 million), after taxation of Rnil (2022: Rnil).


The Directors believe that the Company has adequate financial resources to continue in operation for the foreseeable future and accordingly the annual financial statements have been prepared on a going concern basis. The Directors have satisfied themselves that the Company is in a sound financial position and that it has access to sufficient borrowing facilities to meet its foreseeable cash requirements. The Directors are not aware of any new material changes that may adversely impact the Company. The Directors are also not aware of any material non‑compliance with statutory or regulatory requirements or of any pending changes to legislation which may affect the Company.

The Company’s forecasts and projections, taking account of reasonably possible changes in trading performance, illustrate that the Company should be able to operate within its current funding levels into the foreseeable future.

The Directors reviewed the performance of the Company for the year ended 31 May 2023 including the net loss after tax of R253 million and the accumulated loss of R2 945 billion. The net loss for the year ended 31 May 2023 of R253 million was primarily due to the increase in the expected credit loss provision of R268 million, in line with IFRS 9, for the loan owed by The Prepaid Company to the Company, as well as an ECL adjustment of R40 million relating to the financial guarantee issued to Dark Fibre Africa (SPV5). Refer to note 16.

After making enquiries, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing the financial statements.


Refer to note 9 of the annual financial statements for detail of the movement in authorised and issued share capital.


No dividends were declared or paid to the shareholders during the year.


Details of the Company’s interests in subsidiaries, associates and joint ventures are presented in the annual financial statements in note 3 and note 4.


The Directors in office at the date of this report are as follows:

Name Office Appointment date Date and nature of change
Larry M Nestadt (Chairman) Independent Non-Executive Director 5 October 2007
Brett M Levy Joint Chief Executive Officer 1 February 2007
Mark S Levy Joint Chief Executive Officer 1 February 2007
Kevin M Ellerine Non-Executive Director 8 December 2009 Resigned 5 June 2023
Gary D Harlow Independent Non-Executive Director 5 October 2007 Resigned 19 October 2022
Nomavuso P Mnxasana Independent Non-Executive Director 18 September 2020
Joe S Mthimunye Independent Non-Executive Director 5 October 2007
Dean A Suntup Financial Director 14 November 2013
Jeremiah S Vilakazi Independent Non-Executive Director 19 October 2011
Lazarus P Zim Independent Non-Executive Director 23 October 2020 Resigned 22 February 2023
Lindiwe E Mthimunye Independent Non-Executive Director 1 November 2022
Happy Masondo Independent Non-Executive Director 1 August 2023


The individual interests declared by Directors in the Company’s share capital as at 31 May 2023, held directly or indirectly, were as follows:

Interests in shares

Directors 2023
LM Nestadt (Chairman) 10 000 000 10 000 000
BM Levy 69 591 549 67 424 914 17 772 777 17 772 777
MS Levy 62 184 141 60 017 506 17 772 777 17 772 777
KM Ellerine*# 120 000 000 120 000 000
GD Harlow# 1 285 114
JS Mthimunye 130 000 130 000 242 573 242 573
DA Suntup 5 106 011 3 958 476 177 778 177 778
SJ Vilakazi 8 200 8 200
* KM Ellerine is a beneficiary of these shares together with multiple other beneficiaries.
# Resigned during the year.

There was no change in the interests held by Directors between 31 May 2023 and the date of approval of these annual financial statements.

The aggregate interest of the current Directors in the capital of the Company was as follows:

Director/officer 2023 2022
Beneficial 302 985 806 298 790 115

The beneficial interest held by Directors and officers of the Company constitutes 33.16% (2022: 32.70%) of the issued share capital of the Company. Details of Directors’ emoluments are set out in note 25.


The Company Secretary is Ms J van Eden.

The Board is satisfied that she has the requisite knowledge and experience to carry out the duties of a Company Secretary of a public company in accordance with section 88 of the Companies Act and is not disqualified to act as such. She is not a Director of the Board and maintains an arm’s-length relationship with the Board.

The business and postal address of the Company Secretary appear on the Company’s website at


Following the conclusion of a comprehensive tender process, the Audit, Risk and Compliance Committee has recommended, and the Board of Directors has endorsed, the appointment of SizweNtsalubaGobodo Grant Thornton Inc. (SNGGT) as the independent external auditors of the Company with effect from 6 February 2023. SNGGT will continue in office in accordance with section 90(6) of the Companies Act.


On 24 November 2022, the Company passed and filed with the Companies and Intellectual Property Commission the following special resolutions:

  • approving the remuneration of Non-Executive Directors;
  • granting a general authority to repurchase the Company’s shares; and
  • approval to grant financial assistance in terms of sections 44 and 45 of the Act.


No letters of support were issued by the Company in the current year. In the prior year a letter of support was issued in respect of Gold Label Investments Proprietary Limited.