Blu Label swings to loss after $371.6 million Cell C disposal

Blu Label Unlimited Group Limited, a South African technology group led by founding brothers Brett and Mark Levy, expects earnings per share to plunge more than 100% for the six months ended Nov. 30, 2025, following a multi-million-dollar loss tied to its restructuring and partial exit from Cell C.

Cell C Holdings, on the otherhand, reported R5.68 billion ($355.8 million) in revenue in its first interim results after listing on the Johannesburg Stock Exchange, marking a renewed growth phase following years of restructuring.

Cell C exit drives massive loss
The Johannesburg-listed group said basic earnings per share will swing from a profit of R0.44 ($0.02) in the prior comparable period to a loss of roughly R5.55 ($0.34) per share. The sharp reversal stems primarily from a net loss of R5.2 billion ($322.1 million) related to its investment in Cell C.

The loss includes R6 billion ($371.7 million) recognized on the disposal of The Prepaid Company’s majority stake in Cell C and Comm Equipment Company (CEC) following Cell C’s listing at a market valuation of R9 billion ($557.48 million).

Blu Label core operations and structure
This was partially offset by a R841 million ($52.1 million) gain on the remeasurement of Blu Label’s previously held interest when it acquired control of Cell C in September 2025.

In September, The Prepaid Company secured regulatory approval to take control of Cell C, consolidating the mobile operator for three months.

However, by the end of November, Blu Label disposed of a 50.45 percent stake and sold CEC to Cell C, relinquishing control and retaining a 49.47 percent interest. Cell C will now be equity accounted as an associate.

Stripping out Cell C and CEC, as well as restructuring and goodwill-related items, Blu Label’s core business remains profitable.

Interim EPS swings from profit to loss
The group would have reported revenue of R5 billion ($309.71 million), EBITDA of R535 million, and net profit after tax of R389 million ($24.1 million). Core headline earnings are expected to range between R0.406 ($0.08) and 0.425 ($0.84) per share, reflecting a more modest decline of up to 14 percent.

While headline earnings per share are forecast to fall between 14 and 18%, management maintains that underlying operational metrics provide a clearer view of earnings sustainability.

For investors, the results underscore both the volatility of large-scale telecom restructurings and Blu Label’s ongoing transition toward a leaner, more focused earnings base.