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Who will overtake scom as most profitable company in Kenya?
guru267
#21 Posted : Friday, November 11, 2011 10:15:30 PM
Rank: Elder


Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
youcan'tstopusnow wrote:

Can cutting CAPEX be used boost short to mid term profits by reducing depreciation?


I think it can boost them in the medium term but I do not believe in this strategy to boost profits because benefits from CAPEX usually outweigh depreciation charges greatly in the long term.

But the growth in their non current assets definitely adds 1billion at least in depreciation charges every year unfortunately.

even then I find it hard to see how safcom can justify a 6billion increase in admin and operating costs for a 6month period.. Forex or no forex .
Mark 12:29
Deuteronomy 4:16
youcan'tstopusnow
#22 Posted : Friday, November 11, 2011 11:50:34 PM
Rank: Chief


Joined: 3/24/2010
Posts: 6,779
Location: Black Africa
guru267 wrote:
youcan'tstopusnow wrote:

Can cutting CAPEX be used boost short to mid term profits by reducing depreciation?


I think it can boost them in the medium term but I do not believe in this strategy to boost profits because benefits from CAPEX usually outweigh depreciation charges greatly in the long term.

But the growth in their non current assets definitely adds 1billion at least in depreciation charges every year unfortunately.

even then I find it hard to see how safcom can justify a 6billion increase in admin and operating costs for a 6month period.. Forex or no forex .


Agreed. On MPESA I think Safaricom is benefiting from the incompetence of its competitors. On voice they may be doing a good job wrestling customers from Safaricom. But with no vast army of agents, they won't make a dent on the money transfer arena...
GOD BLESS YOUR LIFE
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