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The six-month period reflects disciplined execution, strategic focus and meaningful structural progress across the Group. Blu Label continues to transition from its legacy telecommunications distribution roots into a diversified digital infrastructure and enablement platform, supported by improving revenue quality, stabilising margins and cash generation. Management remains focused on operational efficiency, cost discipline and enhancing returns on invested capital.
A defining milestone during the period was the successful restructuring and subsequent listing of Cell C Limited (“Cell C”). Following a multi-year process in which Blu Label played a pivotal role, Cell C has been repositioned into a leaner, asset-light and wholesale-enabled operator with a more sustainable capital framework and materially improved cost base.
This transaction de-risked the Group’s exposure and enhanced earnings visibility. The listing of Cell C introduces transparent market valuation, strengthened governance and independent access to capital for Cell C, reinforcing Blu Label’s role as a strategic shareholder focused on long-term value creation rather than operational support.
Post period-end, BluEnergy secured a multi-year energy trading licence from NERSA, enabling participation in South Africa’s power sector reform and positioning the Group to deliver renewable energy solutions across municipalities and independent power producers (IPPs).
The Group’s reported results for the six-month period were materially affected by the impact of IFRS® Accounting Standards arising from the restructuring transactions and the listing of Cell C. Accordingly, these non-operational accounting effects will affect reported earnings for the financial year ending 31 May 2026.
The Board has resumed dividend distributions, declaring an interim dividend of 43.56 cents per share, reflecting confidence in the Group’s financial position, cash generation and sustainable earnings outlook.
The Group exits the period with a simplified structure, stronger capital base and clearer strategic direction, positioning Blu Label to focus on scalable digital platforms, infrastructure and adjacent technology-enabled services while benefitting from the value crystallisation achieved through Cell C.
The Group’s financial results for the six-month period ended 30 November 2025 were materially impacted by a series of strategic transactions, most notably the acquisition of control of Cell C, the subsequent pre-listing restructuring (which included the disposal of Comm Equipment Company ("CEC")), and the partial disposal of Cell C which resulted in it transitioning from a subsidiary back to an associate.
These transactions, while strategically important, introduce a degree of accounting complexity that created volatility in the underlying performance of the Group. Although the related accounting treatments are required under IFRS Accounting Standards, they are not indicative of Blu Label’s core operational trajectory or earnings capacity.
Accordingly, in order to provide a clearer understanding of the Group’s core performance, normalised financial information has been presented excluding Cell C's and CEC's financial results for the six-month period, a goodwill impairment, and all extraneous items associated with the pre-listing restructuring of Cell C.
This approach provides an alternative basis from which to evaluate the Group's sustainable earnings profile and ongoing performance. The normalised financial information is not based on IFRS Accounting Standards and does not form part of the primary financial statements of the Group.
On a normalised basis for the six months ended 30 November 2025, the financial highlights were as follows:
| Normalised Financial Results | Group Nov 2025 R’000 |
|---|---|
| Revenue | 5 020 431 |
| Gross income | 1 353 079 |
| EBITDA | 535 161 |
| Net profit after tax attributable to equity holders of the parent | 389 054 |
| Headline earnings | 397 658 |
| Core headline earnings | 397 855 |
| Share performance: | |
| Earnings per share (cents) | 43.22 |
| Headline earnings per share (cents) | 44.17 |
| Core headline earnings per share (cents) | 44.19 |
Following the successful restructuring of Cell C and the relinquishment of control, the Group will equity account for its 49.47% shareholding in Cell C going forward. This equity-accounted contribution will include CEC’s earnings, following the disposal of CEC to Cell C in November 2025 and its integration into the Cell C group. Accordingly, the Group’s normalised earnings will incorporate its proportionate share of Cell C’s profitability, which will be added to the core headline earnings base of R398 million. This is expected to provide a more comprehensive view of the Group’s total earnings while enhancing earnings visibility.
The interest in Cell C comprises a shareholding of 49.47% plus an additional economic interest of 15.95% in respect of the sale by The Prepaid Company ("TPC") of such equity interest to Sisonke Growth Partners (a Broad-Based Black Economic Empowerment special purpose vehicle) using vendor funding provided by TPC. TPC continues to recognise the 15.95% stake as an asset which has been classified as a non-current asset held for sale because the Group has commenced a formal disposal or refinancing process that is expected to result in accounting derecognition of such stake within the next 12 months.
Proceeds from this transaction are intended to support debt reduction and strengthen the Group's working capital position.
Group revenue, excluding Cell C’s consolidated results for the three months ended 30 November 2025, and CEC’s results for the full six-month period, amounted to R5 billion. As only the gross profit earned on “PINless top-ups”, prepaid electricity, ticketing and universal vouchers are recognised as revenue, on imputing the gross revenue generated from these sources, the effective growth in revenue equated to R5 billion (11%), resulting in a total revenue of R50.9 billion compared to the prior period of R45.9 billion.
Gross revenue generated on “PINless top-ups” increased by R1.8 billion from R10.6 billion to R12.4 billion.
Electricity revenue generated on behalf of the utilities increased by R2.3 billion (11%) from R21.9 billion to R24.3 billion. Commission earnings, primarily calculated based on kilowatt-hour (“kWh”) consumption, declined by R16 million (10%) from R161 million to R144 million. The decline in commissions was driven by margin compression, despite overall growth in gross electricity revenue, supported by NERSA-approved tariff adjustments and inflationary increases linked to kWh usage.
Gross ticketing revenue declined by R102 million (14%), resulting in a decline in commissions earned of R7 million. The decline was driven by a reduction in sales of music festivals and concerts, which have historically generated lower margins offset by a growth in commuter bus channel revenues.
Gross revenue from universal vouchers increased by R1.7 billion (23%) from R7.3 billion to R9 billion, underpinned by the continued expansion of BluVoucher sales through financial institution channels.
BLU’s reported results include Cell C’s equity-accounted contribution for the three months ended 31 August 2025, its consolidated results for the three months ended 30 November 2025, and CEC's results for the full six-month period, as the disposal became effective only at the end of November 2025.
| Reported Financial Results | Group Nov 2025 R'000 |
Group Nov 2024 R'000 |
Growth R'000 |
Growth % |
|||
|---|---|---|---|---|---|---|---|
| Revenue | 8 637 903 | 7 245 092 | 1 392 811 | 19 | |||
| EBITDA | (4 112 561) | 653 155 | (4 765 716) | (730) | |||
| Net profit after tax attributable to equity holders of the parent | (5 001 364) | 395 353 | (5 396 717) | (1 365) | |||
| Headline earnings | 347 517 | 413 545 | (66 028) | (16) | |||
| Core headline earnings | 374 401 | 424 302 | (49 901) | (12) | |||
| Share performance: | |||||||
| Earnings per share (cents) | (555.56) | 43.98 | (599.54) | (1 363) | |||
| Headline earnings per share (cents) | 38.60 | 46.01 | (7.41) | (16) | |||
| Core headline earnings per share (cents) | 41.59 | 47.20 | (5.61) | (12) | |||
Included in earnings for the six months ended 30 November 2025 is a net loss of R5.2 billion relating to the Group’s investment in Cell C, which is added back for headline earnings.
The loss comprises R6 billion recognised on the disposal of TPC’s investment in Cell C and CEC following Cell C’s listing at a market value of R9 billion, partially offset by a gain of R841 million on the remeasurement of the previously held interest when TPC acquired control of Cell C in September 2025.
The Statement of Financial Position has been materially simplified following the successful implementation of the Cell C pre-listing restructuring and subsequent listing, with much of the historic complexity associated with Cell C funding instruments and restructuring-related transactions now unwound.
Key structural changes include:
Key balance sheet movements related to the above:
Financial assets at fair value through profit or loss of R372 million were reallocated to the investment in Cell C following the completion of TPC’s acquisition of SPV1 and Gramercy’s shareholdings in Cell C, subsequent to receiving Competition Commission approval.
Investment in associates and joint ventures increased from R1.7 billion to R5.9 billion, driven primarily by Blu Label’s investment in Cell C. The opening investment of R1.7 billion was deemed to be disposed of at fair value upon Blu Label obtaining control of Cell C. Following Cell C’s listing on 27 November 2025, the Group disposed of a portion of its shareholding, resulting in the loss of control and deconsolidation of the Cell C Group (including CEC), while retaining a significant minority interest accounted for as an associate at an initial fair value of R5.9 billion.
Of this amount, R1.4 billion, comprising a 15.95% interest in Cell C sold to Sisonke Growth Partners, has been reclassified as a non-current asset held for sale within current assets, leaving a balance of R4.5 billion recognised within investments in associates and joint ventures.
The loss of control of the Cell C Group (including CEC) resulted in the full derecognition of CEC’s assets and liabilities. This included a reduction in purchase price allocation intangible assets and goodwill of R444 million, together with a decrease in advances to customers of R1.6 billion. Interest-bearing borrowings declined by R1.7 billion following the derecognition of the CEC facility with African Bank.
Cash and cash equivalents increased by R1.8 billion, primarily driven by proceeds of R2.7 billion received from the sell-down of a 30% shareholding in Cell C, based on an equity valuation of R9.0 billion. A portion of the proceeds is intended to be applied towards the settlement of certain interest-bearing borrowings and other debt obligations, with the remaining cash enhancing the Group’s liquidity position and supporting ongoing working capital requirements.
As a result, the Group is positioned with a simpler and more transparent balance sheet and enhanced financial flexibility.
The Statement of Cash Flows includes Cell C’s consolidated results for the three months ended 30 November 2025.
Cash generation remains a central focus for the Group, and Blu Label continues to demonstrate strong cash conversion once restructuring-related impacts are excluded.
Normalised EBITDA translated into operating cash flows, supported by disciplined working capital management and capital expenditure aligned with the Group’s asset-light business model.
Cash generated from trading operations, including three months of cash generated by Cell C, amounted to R1.5 billion. Working capital movements include a decrease in inventory of R363 million and an increase in trade payables of R1.5 billion, offset by an increase in trade and other receivables of R553 million and an increase in advances to customers of R240 million. After incurring net finance costs of R424 million and taxation of R63 million, net cash generated from operating activities amounted to R1.016 billion.
Net cash flows generated from investing activities amounted to R1.8 billion of which R2.8 billion related to the net proceeds raised on the acquisition and subsequent disposal of Cell C and CEC. This was offset by the purchase of intangible assets and fixed assets amounting to R490 million, and the additional funds advanced to Cell C prior to listing, amounting to R641 million.
Cash flows utilised in financing activities amounted to R926 million, of which R851 million related to lease repayments. Included in these repayments was a lease settlement of R733 million paid to Dark Fibre Africa by Cell C. Further net outflows of R75 million related to borrowings, comprising an inflow of borrowings raised amounting to R1.552 billion, largely relating to a bridge loan in TPC, offset by repayments amounting to R1.626 billion.
Cash and cash equivalents accumulated to R2.69 billion at 30 November 2025.
The Group enters the second half with strong operational momentum, improved earnings visibility and a clearer pathway to medium-term value creation, supported by continued cost discipline and margin optimisation.
Core prepaid distribution and payments operations remain resilient, with management focused on protecting the Group’s market-leading position, deepening client relationships and enhancing and executing on revenue assurance capabilities (including municipal payment enablement at scale).
Strategic investments are shifting from build-out to commercial execution, with BluEnergy progressing toward first contracted revenues on the back of an expanding municipal/commercial pipeline and project readiness. Post period-end, BluEnergy has secured a multi-year energy trading licence from NERSA, enabling participation in South Africa's power sector reform and the delivery of renewable energy solutions across municipalities and independent power producers.
Strategic investments in data analytics, AI and digital platforms are transitioning from development to commercial execution, positioning the Group for sustained performance into FY26.
The Group has resumed dividend distributions, declaring an interim dividend of 43.56 cents per share, reflecting confidence in its financial position and sustainable earnings outlook.
The Blu Label Board would like to extend its gratitude to the staff, suppliers, customers and business partners for their ongoing support and dedication to the Group.
For and on behalf of the Board
LM Nestadt
Chairman
BM Levy and MS Levy
Joint Chief Executive Officers
DA Suntup* CA(SA)
Financial Director
25 February 2026
* Supervised the preparation of the Group’s unaudited six-month period ended results.
