Remgro, which owns 57% of CIVH – the parent of Vumatel and Dark Fibre Africa owner Maziv – has reported the fibre operator swung to a loss in the year ended 30 June 2024.

CIVH’s contribution to Remgro’s headline earnings amounted to a loss of R75-million, from a profit of R206-million in the 2023 financial year.

“The decrease in earnings is mainly due to higher finance costs resulting from increased interest rates and higher maintenance and security costs to ensure high network uptime, and the continued impact of the tough economic environment on consumers and persistent competition in the market,” Remgro told investors.

Remgro said Vumatel’s revenue for the year to end-March 2024 increased by 3.2% to R3.54-billion, “driven by its fibre infrastructure expansion programme and subscriber uptake growth”.

Vumatel’s Reach network, which provides lower-cost fibre access in areas like Mitchells Plain in Cape Town, expanded by 12%, with Reach homes now exceeded a million and the number of customers growing by 39% compared to a year ago. Earlier this week, Vumatel also launched its Vuma Key product, aimed at low-income townships and similar areas.

Dark Fibre Africa’s (DFA’s) revenue for the year ended 31 March 2024 increased by 2.3% to R2.72-billion, driven by demand from businesses for fibre broadband access.

News of the weaker results in the Maziv stable comes as Vodacom moves to buy a 30-40% stake in the company. Vodacom’s planned investment in Maziv is currently under scrutiny by the Competition Tribunal after the Competition Commission last year recommended the deal not be allowed to proceed on competition grounds.

Ongoing

“As a result of the proposed transaction, Remgro’s indirect interest in DFA and Vumatel will dilute with the entrance of Vodacom as a shareholder. However, Remgro will also obtain an indirect interest in the assets contributed by Vodacom,” Remgro said. Vodacom plans to invest R6-billion in cash into Maziv and contribute R4.2-billion worth of its own fibre network assets.

“The final phase of the regulatory approval process, which started on 24 May 2024, is still ongoing and a decision is expected during November 2024. Remgro and CIVH remain committed to the proposed transaction and firmly believe that, should the implementation of the proposed transaction ultimately be permitted by the Competition Tribunal, it will deliver significant benefits to South African consumers and the broader economy.” — © 2024 NewsCentral Media