Vodacom Group eked out a 1.2% improvement in normalised operating profit for the six months ended 30 September 2019 on the back of 2.5% growth in both normalised revenue and service revenue.
The telecommunications operator said on Monday that headline earnings per share rose by a 18.9% due to once-off costs of R1.5-billion in the same period a year ago related to its black economic empowerment transaction.
Vodacom added 2.7 million customers plus 2.7 million more in Kenya’s Safaricom during the period, to serve a combined 115 million subscribers across all its operations.
South African service revenue grew 0.3%, supported by the turnaround to growth in the second quarter as the reduction in out-of-bundle revenue was offset by improved data elasticity and the completion of the full onboarding of Telkom as a roaming partner.
International operations performed well, with reported service revenue growth of 15.5% (8.7% normalised), with foreign currency translations boosting the reported number.
“In South Africa, an increase in data usage, following sustained efforts to reduce data prices and the on-boarding of our new roaming partner in the second quarter, more than offset the service revenue decline reported in the first three months of the financial year,” said CEO Shameel Joosub.
“On a like-for-like basis, this resulted in service revenue growth of 1.5% during the half year, despite ongoing economic pressures and the implementation of (communications regulator Icasa’s) end-user and subscriber service charter regulations.”
Vodacom is also moving to sell more services to customers as part of a “strategy to build diverse revenue streams”.
“Revenue from our financial services business jumped by 37.1% to almost R1-billion as Airtime Advance, insurance and our recently launched VodaPay service all gained in popularity.”
Vodacom said more than a million people have made video-on-demand purchases, while its music, sports, games and other video services — all in their infancy — are contributing to solid growth in its digital services business.
Vodacom declared an interim dividend of R3.80/share and a special dividend of 60c/share for the period. — (c) 2019 NewsCentral Media