Smoke and mirrors
The telecoms group’s results were a master class in double speak with smoke and mirrors added for extra effect. Revenue is up by 6.7% (but decreased by 18.5%). Confused? The small print tells the story that revenue in constant currency was up 6.7%, but actual revenue as reported was down 18.5% and the latter number is the one that matters. Now, sure, constant currency is important for investors in order to get an understanding of how the actual underlying businesses are doing, but don’t mix the message. Give us the real numbers up front rather than trying to fudge them. The reality is that currencies move and sometimes this will increase profits and at other times they’ll hurt. Digging into the results, we can see that diluted headline earnings per share (HEPS) was 212c compared with a loss of 271c in the previous year. But 2016 is not a fair comparison and going back to 2015 (in other words before the Nigerian fine) we see in the six months to June 2016 HEPS was 654c while the six months to June 2014 HEPS was 729c. In short, these results are a shocker.