Telecommunications giant Vodacom Group has reported growth across its revenue lines, delivering a strong first- quarter performance despite financial markets turmoil, rising inflation and global economic recovery uncertainty.

During the first quarter to June 30, 2022, group revenue increased 5.2% to R26.05-billion underpinned by a resilient financial performance in most markets and South Africa, in particular.

Group service revenue also increased 5.2% to R20.15-billion, supported by growth in data revenue and new services such as the Internet of Things.

South Africa’s service revenue grew 3% to R14.5-billion, with an improved 5.1% growth in the customer contract base to 6.5-million, while the international operation reported service revenue of R5.85-billion, an increase of 10.4%, underpinned by an 11.8% increase in M-Pesa revenue and a 23.4% rise in data revenue.

Financial services revenue increased 9.3% to R2.1-billion, with further reductions of mobile money levies announced in Tanzania. Adjusted for this impact, growth would have been an estimated 19.7%.

“Financial services remains a clear strategic priority for the group,” says Vodacom Group CEO Shameel Joosub, noting that the segment is driven by mobile money platform M-Pesa.

“Combined with Safaricom, our M-Pesa platform processed $340-billion over the last twelve months, up 20.2%. Looking ahead, a further meaningful 43% reduction to mobile money levies in Tanzania from July 2022 bodes well for M-Pesa’s contribution to financial inclusion in the country.”

The group’s VodaPay super-app in South Africa also experienced strong uptake, with 2.8-million downloads and 1.9-million registered users by the end of the quarter.

“During the past quarter, we made good progress on the optimisation of our assets, which in the medium term, will also positively contribute to bridging the digital divide. For instance, we are in the process of establishing a separate legal entity for our South African ‘TowerCo’ that will be 100% owned by Vodacom Group and intend to announce the MD of the business in due course,” Joosub comments.

Meanwhile, Vodacom’s R41-billion acquisition of a 55% stake in Vodafone Egypt is expected to receive Egyptian regulatory approval in the near term.

In addition, the regulatory approval process for the proposed acquisition of a 30% stake in CIVH’s fibre assets continues to make progress.

“We expect this transaction will conclude in the current financial year.”

Safaricom Ethiopia is making progress on its commercial launch plans, with the phased launch starting from August 2022 in the city of Dire Dawa, before accelerating to 24 other cities, including Addis Ababa, over the next few months.