Vodacom has declared an interim dividend of 260c/share, translating into an almost R3,9bn windfall for the company’s shareholders. The interim dividend has been hiked by 44,4%.

The JSE-listed cellphone group announced the dividend alongside its interim results for the six months to 30 September 2011, which revealed a strong financial performance driven by demand for broadband and a sharp rise in subscriber numbers.

At the end of September, Vodacom had 28,9m subscribers in SA, up by 21,1% from a year ago. Customers in other African markets rose to 19m, an increase of 22,5%. Headline earnings per share climbed by 6,9% to 324c, with group data revenue up 31,1%, representing 14,1% of service revenue. Turnover for the period was R31,7bn.

The strong performance came despite pressure on retail tariffs, with the average effective price per minute for voice calls falling by 24% and data prices coming off by 22%.

In the six months, Vodacom invested R3,5bn in its network, which included expanded third-generation (3G) coverage and investments in fibre optics. Capital expenditure in SA was 83,4% up on last year, a large proportion of which went into transmission networks.

At the end of September, Vodacom had 4 642 3G base stations, 68,4% of which support speeds of up to 21Mbit/s.

In SA, gross connections increased sharply to 8m, which the group attributes to its recent brand refresh and promotions and handset deals pushing this number up by 56,5%. It suggests Vodacom took market share from rivals in the period.

Average revenue per user, a key metric, fell by 9% in SA to R141 as a result of lower termination rates (the fees the mobile operators charge each other to carry calls on their networks) and a higher number of lower-usage customers.

Group earnings before interest, tax, depreciation and amortisation increased by 7,6% to R10,5bn, with the margin stable at 33,2%.

The Democratic Republic of Congo remains a problem for Vodacom. The group is in dispute with its partner in the operation, Congolese Wireless Network. The two parties are in arbitration. Vodacom Group CEO Pieter Uys says he expects a resolution to the matter in the next few months, which could include Vodacom’s exit from the troubled central African nation. — Staff reporter, TechCentral