From 61,000 to 9,500 – Telkom’s jobs bloodbath

Telkom is pushing ahead with the restructuring of its ICT business, BCX, with 400 jobs affected.

Speaking about the group’s results for the six months ended 30 September 2024 (H1 2025), Telkom CEO Serame Taukobong said that the group demonstrated a robust and steady underlying operational performance.

Overall group revenue jumped by 2.1% to R21.7 billion, which was driven by continued strong demand for its data operations as mobile service revenue grew by 10.0%, fibre data service revenue increasing
by 15.5% and IT services revenue is up by 1.9%.

These issues offset the ongoing fixed voice and legacy data erosions.

“Earnings were impacted by a R451 million after-tax adjustment emanating from converting the Telkom Retirement Fund to a defined contribution plan, following the Financial Sector Conduct Authority’s rule
amendment approval during the period. Restructuring costs of R160 million were also provided for during the period,” said Taukobong.

“Given these non-recurring items, we believe that adjusted figures provide the most accurate representation of our true performance and align with how Telkom is managed.”

“Underlying operational performance improved, driven jointly by revenue growth and internal cost optimisation initiatives. We made substantial progress during the period as we advanced data-led revenues and harnessed gains from cost optimisation initiatives, with a resultant adjusted Group EBITDA growing ahead of group revenue.”

Taukobong added that as part of building a sustainable business, its BCX is being restructured.

BCX announced the initiation of the second phase of the S189 process, with roughly 400 employees being affected.

The restructuring cost of R157 million was recorded due to the BCX restructuring.

“The accelerated pace of change in the technological environment has significantly reshaped the role of IT,” said the group.

“This necessitated fundamental changes to BCX’s operations to enable the business to reduce its cost base while revitalising itself. We … aim to conclude the majority of the process in the second half of FY2025.”

During H1 2025, BCX’s IT services revenue increased by 1.9% to R2.3 billion.

The latest cuts add to the massive changes in Telkom’s headcount over the last 25 years.

In 1999, Telkom started reducing its workforce from 61,237. According to the latest results, Telkom’s total number of employees currently stands at 9,894.

With the BCX restructuring, the total number of employees could drop to under 9,500.

When looking at the group’s results, several indicators did point up.

Profit for the period grew by 9.7% to R1 billion, while earnings per share increased by 8.7% to 217.6 cents.

That said, headline earnings per share dropped by 1.8% to 191.5 cents per share.

The group has not declared a dividend but previously noted that it plans to start paying dividends at the end of the current financial year.

Outlook

“While we face challenges such as high unemployment rates and the need for economic growth to support our connectivity businesses, we are encouraged by positive signs in South Africa, including lowering interest rates and moderating inflation,” said the group.

“Looking ahead, the strength of our balance sheet remains a top priority, ensuring that we stand resilient in the face of challenges. We will endeavour to maintain the good momentum we have experienced so far in the second half of the year, which is pointing towards a sustained trend of positive free cash flow.”

“It is important to emphasize that our focus on efficiency drivers is not solely about reducing workforce numbers but rather about optimizing performance across the board. We are actively reshaping the business construct without compromising our core strengths.”

Read: Distressing trend emerging for homeowners in South Africa