The Johannesburg Stock Exchange (JSE) has had its worst performance since the global financial crisis, ending last year down 11%.
Naspers was the biggest drag on the benchmark, in terms of index points, dropping 16% for the worst annual performance by Africa’s largest company by market value since 2001.
South African telecommunications companies were also hard hit, with MTN, Vodacom, and Blue Label Telecoms suffering huge stock losses in 2018.
Blue Label Telecoms was the biggest loser among the main telecommunications shares, with its share price declining from R15.00 per share on 2 January 2018 to R5.41 on 31 December 2018.
This big decline is mainly due to concerns about Blue Label Telecoms’ 45% shareholding in Cell C, which has been struggling to become profitable.
Blue Label Telecoms Co-CEO Brett Levy said “the punishment does not fit the crime” in this regard, arguing that Cell C has a bright future and they are making good progress to turn the company around.
MTN was also a big loser in 2018, with its share price declining from R136.50 on 2 January 2018 to R89.00 on 31 December 2018.
This 33% decline was partly a result of ongoing battles in Nigeria with the country’s central bank ordering the company to refund $8.13 billion in allegedly illegally repatriated money.
MTN reached a settlement with Nigeria’s central bank by paying $52.6 million to end the dispute, but the damage to the share price still lingers.
Telkom was the only big telecoms company which performed well in 2018, with its share price increasing by 35% from R47.93 to R63.29.
This increase was partly thanks to Telkom’s mobile unit which has shown rapid growth over the last 12 months.
The graphs below show the performance of South African telecommunications companies, which are listed on the JSE, over the past year.
Telkom – 34.72% growth
Vodacom – 8.31% decline
MTN – 33.45% decline
Blue Label Telecoms – 63.84% decline