Cell C’s big battle with technical insolvency

Cell C’s latest financial results revealed that the mobile operator is not out of the woods yet and has a lot of work ahead of it to improve its financial position.

On Monday, 22 September 2025, Blue Label Telecoms made a presentation available about the Cell C business.

The presentation, titled “The South African Network Operator of the Future”, shed light on Cell C’s plans and financial position.

The operator promoted its turnaround, which started in 2017 and included halting debt payments, cutting unprofitable services, and rebalancing its network.

The initial turnaround strategy did not work as planned, which necessitated another recapitalisation process a few years later.

Despite numerous challenges, Cell C is confident that it is on the right track to build a successful business as its turnaround gains momentum.

It explained that its new turnaround strategy is driven by strong leadership, a fully migrated network with parity, and a capex-light model.

Despite its confidence in the current trajectory, Cell C confirmed that its legacy debt and capital structure remain key challenges to address.

“Our focus remains on strengthening the capital structure, leveraging partnerships, and delivering exceptional customer experience,” Cell C said.

The mobile operator is looking at an initial public offering (IPO) to restructure for long-term growth in the public market.

“Cell C is now a lean, agile, and well-governed operator with a proven turnaround, strong financials, award-winning network quality, and a platform for sustainable growth,” it said.

“The business is well-positioned for public market readiness and long-term value creation.”

Cell C added that it has made significant progress in relation to the pre-IPO restructuring, with the details expected to be published later in September 2025.

Cell C finances

Daily Investor performed a like-for-like comparison of Cell C’s finances over the last few years, which highlights the challenges ahead.

Cell C’s results for the year that ended 31 May 2025 showed that it generated R11.14 billion in revenue in the latest financial year.

Over the past years, Cell C has experienced a downward trajectory. Revenue plummeted from R15.4 billion in 2019.

An analysis of Cell C’s revenue showed that the mobile operator experienced a 5.4% average annual decline over the last six years.

Over the same period, Cell C saw its profitability improve. In 2019, it reported a loss before tax of R3.9 billion, which improved to a profit of R264 million for the 2025 financial year.

Cell C remains technically insolvent

Despite the recapitalisations and the turnaround strategies, Cell C remains technically insolvent. This means that its asset book value is lower than its liability book value.

Therefore, if the company sold all of its assets at their respective book values, it would not be able to settle its debt. This means that Cell C has a negative equity value.

Over the last few years, Cell C has improved its equity position following a significant debt recapitalisation in 2022. Despite this, Cell C’s liabilities still exceed its assets by over R1 billion.