Vodacom adds 3m SA customers - TechCentral

Vodacom adds 3m SA customers

Vodacom CEO Shameel Joosub

Vodacom added almost 3m customers in South Africa in the year ended 31 March, helping service revenue increase by 5,6%, the telecommunications group said on Monday. The strong growth suggests it has taken market share from rivals.

For the year, group Ebitda — a measure of operating performance — grew by 2,9% to R31,2m, up 7,1% (excluding the impact of currency fluctuations), with margins improving by 0,5 percentage points to 38,4%. Headline earnings per share climbed by 4,5% to R9,23, while Vodacom declared a final dividend of R4,35/share, taking the total dividend for the year to R8,30/share.

Other highlights included a 16,4% improvement in group data revenue and capital expenditure of R11,3bn, with a spending focus on data expansion and IT platforms. R8,5bn of that figure was spent in South Africa to expand 4G coverage to 75,8% of the population and 3G to 99,8%. Over the past three years, capital expenditure across the group totalled R37,5bn, with R25,9bn of that going into South Africa.

A strong performance in South Africa, by far Vodacom’s largest market, was offset by the impact of currency volatility. In its international operations, service revenue declined by 5,6%, though it would have climbed by 2,2% if it hadn’t been for currency movements. Overall group service revenue grew by 2,3% (4,4% without the impact of currencies).

“In South Africa, customers have responded positively to our segmented marketing approach and concerted efforts to increase bundle adoption engagement, particularly through our ‘Just 4 You’ offers,” said CEO Shameel Joosub in notes accompanying the results. “This resulted in the sale of almost 1,5bn bundles, an increase of 34,1%, and ultimately in the increase in our net promoter score lead over our next-best competitor.

“The sustained demand for data remains a key driver for growth with active data users up 8,3% in South Africa and 29,3% across our international operations. Data now comprises 36,3% (up from 31,9% a year ago) of group service revenue.”

Vodacom said enterprise (business) revenue grew by 9,9%, while cloud and hosting revenue grew by 32,5%. Internet of things revenue was up by 19,1% to R662m.

Customers in South Africa grew to 8,6% to 37,1m. Prepaid customers reached 32m, up 9,3%. Vodacom added 218 000 contract customers during the year, with reduced contract churn of 4,2% and average revenue per user rising 2,8% to R408. The number of data customers increased by 8,3% to 19,5m, with data traffic climbing 43,2%. 4G customers increased by 86,7% to 5,1m, while the average monthly data usage on smartphones jumped by 25% to 560MB.

Outside South Africa, total customers increased by 9,3% to 29,7m with net additions of 2,5m.  — © 2017 NewsCentral Media

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