Vodacom reports profit and customer growth

Vodacom on Monday reported a 7.4% rise in group service revenue to R66.76 billion, in results for the year ended March 2016, underpinned by improved trends in voice revenue and data revenue growth of 28.5%.

Data revenue contributes 31.9% of group service revenue compared to 26.7% a year ago, it said.

Revenue grew at 7.5%, to R80 billion, supported by strong demand for devices, particularly smartphones, the group said.

In South Africa, service revenue returned to growth increasing 4.9% (R49.3 billion) mainly due to the growth in mobile data and fixed-line services, and improving voice revenue growth trends, Vodacom said.

Group operating profit increased 9.5% to R21 billion mainly due to EBITDA growth, partly offset by higher depreciation and amortisation of R8.74 billion as the company said it accelerated capex investment over the past two years.

In South Africa, operating profit increased 8.6% to R19 billion, while international
operations’ operating profit increased 20.5% to R1.89 billion.

Headline earnings per share improved to  883 cents per share versus 860 cents before.

Group capital expenditure of R12. 875 billion, focused on rapidly expanding LTE/4G coverage and increasing data speeds, the company said.

Vodacom announced a final dividend per share of 400 cents, taking the total dividend to 795 cents per share for the year.

Shameel Joosub, Vodacom Group CEO, said: “I am very pleased with our performance this year, with strong execution of our strategy delivering solid results. The acceleration in network investment over the past two years is a true success story of effective capital investment to ensure growth in revenue and customers.

“The demand for data continues to be our key driver. Overall revenue grew 7.5% with a
slight decline in customers to 61.3 million, as a result of customer registration requirements in our International operations.”

In South Africa, Joosub said that the company’s network superiority has played a significant part in offering better value to 34.2 million customers, 2.1 million up from last year.

“We spent R8.7 billion to upgrade our network infrastructure which includes more than doubling our LTE/4G sites to over 6,000. This enabled us to increase LTE/4G coverage across South Africa to 58% (from 35%) to satisfy exceptional growth in demand for data.”

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Vodacom reports profit and customer growth