JSE-listed Vodacom has ended the year to March 31 with strong customer growth, increased revenue and earnings and increased traffic on its network.
Vodacom’s group revenue increased 4.8% to R90.7-billion, with group service revenue up 5% to R73.3-billion during the financial year under review.
“An improved second half performance in South Africa and the sustained growth of our international businesses contributed to the group’s 8.9% increase in headline earnings per share (HEPS) to 945c and a dividend return of 845c to shareholders,” said Vodacom CEO Shameel Joosub.
The company’s earnings a share increased 7.7% to 939c apiece.
Earnings before interest, tax, depreciation and amortisation (Ebitda) increased 11.6% to R37.6-billion during the year under review.
This comes as Vodacom adds 5.9-million customers, bringing its total customer base, including Safaricom, to 116-million, highlighting a year characterised by strong customer growth.
During the year ended March 31, total financial services customers increased 12.8%, or six-million, to 53.2-million.
“Despite deteriorating economic pressures and the proactive price cuts to our out-of-bundle rates, South Africa service revenue grew 2.3% to R52.7-billion, with data use elasticity supporting recovery to growth in the second half.
“In South Africa, sharp data price reductions, specifically out-of-bundle data rates, announced in the first quarter led to a steady increase in data traffic as the year progressed with 1.9-million more data customers connecting to the Vodacom network, a 9.7% increase to 21.9-million,” Joosub commented.
Vodacom’s revenue from its financial services business increased 21.5% to R2-billion, on the back of offerings such as airtime advance, insurance and VodaPay services.
“Our digital services business has also produced solid growth, contributing R1.5-billion in revenues on the back of increasing purchases of our video-on-demand offering and our music, sports, gaming and other video services,” he added.
Meanwhile, Vodacom’s international operations achieved strong service revenue growth of 12.5% to R21.8-billion, with foreign currency translations, the addition of four-million customers and increased demand for data and M-Pesa services boosting reported group growth.
“It has been another stellar year for our international portfolio, where we recorded margin expansion for a second year, and further diversifies our currency exposure from the South African rand,” Joosub pointed out.
Vodacom’s investment in Safaricom delivered a 30.4% boost in profits, with growth bolstered by currency factors and inclusion of the new M-Pesa joint venture.
“Significant investments in network and infrastructure, an acceleration in pricing transformation and a 17.2% underlying increase in revenue from M-Pesa, all contributed to Safaricom’s success,” he said.
The M-Pesa ecosystem now processes more than $14.7-billion a month in transactions through the platform, with 40-million customers transacting on M-Pesa across all Vodacom’s operations, generating total revenue of R16.2-billion and growing at 22% a year.