Blue Label Telecoms has significantly reversed a substantial impairment on its Cell C investment, demonstrating a firm conviction in the mobile operator’s recovery.
This reversal underscores Cell C’s triumphant return to profitability after years of hardship and unlocks multibillion-rand value for Blue Label.
The transaction also facilitates Cell C’s transition to an independent publicly traded company, thereby inaugurating a new era for both organisations.
Reversal of Cell C impairment boosts Blue Label’s earnings
The reversal of Cell C’s R1.56 billion impairment drove Blue Label’s substantial financial achievements for the year ended May 31, 2025. Core headline earnings rose 258% to R2.43 billion, while headline earnings increased sixfold to R4.1 billion.
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The net profit after tax rose from R647 million to R2.5 billion. Cell C’s return to profitability and equity value reversed losses from 2019 and drove this rapid improvement. Blue Label’s earnings per share jumped from 74 cents to R4.56, indicating investor confidence in its telecom assets.
Plans to list Cell C independently on JSE
Blue Label is preparing to put Cell C on the Johannesburg Stock Exchange as a separate company. This will probably happen in 2026.
This will let Cell C work and be valued independently, promoting openness and unlocking shareholder value. Comm Equipment Company is being merged into Cell C to make it easier to handle post-paid customers and streamline supply chains as part of this strategic reorganisation.
Blue Label wants to get a controlling stake by raising its holding above 49.5%, but this needs to be approved by the government first. This move will help Cell C leave “all of the ghosts of the past” behind, setting it up for long-term growth in a tough telecom market.
Market reacts positively with share price gains
Investors are happy with Blue Label’s strategy moves and the turnaround at Cell C, which is why the share price has gone up by 172% in 2025. Total sales increased 7% to R96 billion, even though revenue decreased slightly to R14.1 billion.
This was due to goods like Pinless top-ups and electricity sales. Gross profit margins went up, which shows that Blue Label is becoming more stable in digital services while Cell C keeps its South Africa presence stable. Jorge Mendes, who used to work for Vodacom and now works for Cell C, is credited with leading the recovery effort and restoring market trust.