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Vodacom reports 8.9% jump in full-year earnings

Group revenue up by 4.8% to R90.7bn.
Image: Moneyweb

Mobile operator Vodacom Group reported a 8.9% rise in annual earnings on Monday, buoyed by an improved second-half performance in its domestic market and the sustained growth of its international businesses.

Headline earnings per share (Heps), the main profit measure in South Africa, for the full-year ended March rose to 945 cents from 868 cents a year earlier.

Vodacom, which is majority owned by Vodafone, declared a final dividend of 405 cents per share.

The company said it will be postponing the issuance of medium-term targets, “until such time that we have more clarity on the economic outlook and the effect on our business and operations over the medium term.”

Group revenue rose by 4.8% to R90.7 billion, with group service revenue up 5%.

“The past year has been characterised by strong customer growth – we now connect 116 million customers across the group, including Safaricom – and the benefits of prudent portfolio diversification,” Group chief executive Shameel Joosub said in a statement.

In South Africa, sharp data price reductions announced in the first quarter led to a steady rise in data traffic as the year progressed with 1.9 million more data customers connecting to the Vodacom network, Joosub said.

The increased data usage and 21.5% jump in financial service revenue led to service revenue in South Africa, its biggest market, rising 2.3%.

An additional 4 million customers and increased demand for data and financial services under M-Pesa in each of its operations contributed to a 12.5% increase in service revenue across its international operations.

Its investment in Safaricom, Kenya’s biggest telecoms company, delivered a 30.4% boost in profits, with growth bolstered by currency factors and the new M-Pesa joint venture.

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