The price of repairing an undersea cable suspected of being broken by a ship’s anchor in February 2024, has eaten away at Seacom’s profitability within the six months to 31 December 2024.
Remgro, a 30% shareholder in Seacom, launched its interim outcomes for a similar interval on Monday and reported that the corporate’s earnings fell sharply on account of the cable restore prices.
“Seacom’s contribution to Remgro’s headline earnings for the interval below evaluation amounted to R2-million (31 December 2023: R32-million). The lower in headline earnings relates primarily to once-off cable restore prices incurred on account of cable breaks skilled simply earlier than graduation of the reporting interval,” stated Remgro’s report.
South African web service suppliers and their prospects have been hit by an abrupt disruption to web entry in late February 2024. It was later found that the Seacom, AAE-1 and EIG undersea cables had been broken off the west coast of Yemen within the Crimson Sea after Houthi rebels sank the Rubymar, a Belize-flagged business ship loaded with 41 000t of fertiliser.
The crew deserted the 172m ship after dropping certainly one of its anchors, and the vessel drifted for nearly two weeks by means of an space of the Crimson Sea that’s densely populated with broadband cables.
“It’s usually accepted that the Rubymar dropped an anchor when fired upon and, consequently, it broken cables in proximity,” stated Ryan Wopschall, GM of the Worldwide Cable Safety Committee, a bunch representing subsea cable operators, on the time.
Rerouted
The information working by means of the cables was quickly rerouted and web companies returned to regular for patrons. However Seacom confronted the daunting problem of coming into the unstable Crimson Sea area to restore the injury. Operators scrambled to determine what sort of insurance coverage and safety their upkeep firms would require to work in a battle zone. These components doubtless inflated restore prices considerably. The Houthi rebels, in the meantime, who’re backed by Iran, vowed to proceed attacking vessels till Israel stopped the combating in Gaza.
Learn: Houthi-sunk ship doubtless snapped Crimson Sea web cables
Progress was lastly made in July when a ship owned by E-Marine, a subsidiary of Abu Dhabi-based Emirates Telecommunications Group, made repairs to the AAE-1 cable. The ship then remained within the area to restore the opposite two damaged cables, together with Seacom’s, regardless of the menacing presence of the Houthi rebels.
Regardless of these headwinds, Remgro stated Seacom’s underlying enterprise stays sturdy.
“The outcomes for the interval mirrored a constructive trajectory, with increased income in each the digital companies and digital infrastructure enterprise models and a strong efficiency after normalising the outcomes for the impression of once-off cable restore costsm, it stated.
“The enterprise has continued to service demand for enterprise managed companies together with cybersecurity and cloud companies, which has resulted in elevated income for the Seacom digital companies enterprise unit,” stated Remgro. – © 2025 NewsCentral Media
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