Powertel Communications, the state-owned entity created to provide internet and ICT services, is in severe financial distress, with the Auditor-General’s 2024 report revealing that its losses skyrocketed by an astonishing 450% in a single year. The company is now technically insolvent, with its debts far exceeding its assets, raising serious questions about its ability to survive and compete in Zimbabwe’s fast-paced technology sector.
The report paints a grim picture of a company in freefall. In 2023, Powertel recorded a staggering loss of ZWL$32.3 billion, a massive jump from the ZWL$5.8 billion loss it posted the previous year. This financial black hole has left the company in a precarious position, with its current liabilities—the debts it needs to pay within a year—exceeding its current assets by ZWL$60.5 billion.
This means that even if Powertel sold off all its short-term assets, it still wouldn’t have enough money to cover its immediate debts. The Auditor-General flagged this as a “material uncertainty that may cast doubt on the Company’s ability to continue as a going concern.”
The report exposes deep-seated operational failures that are fueling this financial crisis. One of the most glaring issues is the company’s inability to manage its contracts and assets effectively. The audit found that Powertel had “no lease contracts for some of the leases and there were no addendums availed to support reviews for contracts that had expired.” This lack of basic paperwork leaves the company vulnerable in disputes and suggests a chaotic approach to management.
Furthermore, the company was found to be using non-compliant fiscal tax invoices from suppliers, a practice that could lead to significant financial loss from penalties. While management claims to have addressed this by only using VAT-compliant suppliers now, the fact that it was happening at all points to weak internal controls.
The report also highlights a critical failure in asset valuation. Powertel’s property and equipment valuations were not compliant with International Financial Reporting Standards (IFRS), meaning the value of its assets as stated in its books may not be accurate. The AG’s opinion on this matter was “modified,” a clear signal to the public that the financial statements cannot be fully trusted.
For a company operating in the technology space, these failures are particularly dangerous. The inability to manage finances, secure proper contracts, and accurately value assets prevents Powertel from investing in the necessary upgrades to keep pace with its private-sector competitors. While other companies are rolling out 5G and expanding fibre networks, Powertel appears to be stuck in a financial quagmire.
The AG’s report is a clear warning: without a drastic intervention to fix its finances and overhaul its operations, Powertel Communications risks becoming another failed state enterprise, a relic of missed opportunities in a sector that is crucial for Zimbabwe’s future.
