UTL Not Collapsing – Chairman

Stephen Kaboyo is opportunistic UTL will turn it around

Stephen Kaboyo, the chairman of Uganda Telecom Limited (utl), has dispelled suggestions that the company is about to collapse.

While he agreed that the firm faced some financial challenges, he added that utl had enough potential to return to profitability.

“It is true we have regulatory challenges that centre on capitalization issues,” Kaboyo said in a statement last week.

“However, I must say that the shareholders -LAP Green and the government of Uganda -are working together to stabilize utl, reverse the causes of distress, resolve the financial problems and return the company to acceptable levels of solvency, liquidity and profitability.”

Earlier in the week, Daily Monitor reported that utl was on the brink of collapse. In a report last week, UCC said utl was facing financial challenges such as a Shs 366bn liability, outstripping its total asset base of Shs 220bn.

“The sector cannot continue this way. The company cannot support the delivery of a decent service and has defaulted on some of its obligations, causing instability in the sector and now something has to be done. utl and its shareholders must sort out this lest its license be revoked,” Godfrey Mutabazi, the executive director of UCC, reportedly told the Daily Monitor.

Among the issues, the UCC report said Utl had failed to comply with audited financial accounts for two years, and that it had failed to pay the set fees for the spectrum it uses, resulting in a Shs 13bn debt to the regulator.

But Kaboyo says the company remained an important player in the industry, and contributed a lot to the economy.

“Its contribution to the ICT sector and the economy cannot be downplayed,” he said.

“Utl employs 460 Ugandans, we pay taxes and we are the sole provider of fixed line communication for the entire government machinery. We need to recognize that Utl is a centre piece of Uganda’s telecom sector.”

Meanwhile, utl has cut its roaming rates for calls across the three East African states and South Sudan. Otaremwa Otuhumurize, utl interconnection and international carriers director, said they had reduced roaming charges by about 17 per cent to Shs 350 from Shs 420.

The reduction comes at a time when the EAC has called for the implementation of uniform roaming rates within the region in order to facilitate business among the member states.

Source : The Observer


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