Mobile operator, Cell C, on Tuesday (14 March) released its financial results for the year ending December 2016, posting its first profit of R540 million.<\/p>\n
The profit follows strong operational and financial growth across key financial indicators, the group said.<\/p>\n
Cell C said subscriber growth increased 20% to 15.3 million active customers over the reporting period.<\/p>\n
Financial highlights:<\/p>\n
“The 2016 financial year was exceptionally challenging, with South Africa\u2019s economic growth essentially flat.\u00a0 Despite this, the company delivered solid results,\u201d said Cell C CEO, Jose Dos Santos.<\/p>\n
\u201cThe strong revenue growth was the result of a focused strategy of innovation, exceptional value in product offerings and a customer-centric approach to how Cell C services its customers,” the chief executive said.<\/p>\n
Service revenue was driven largely by the growth in data volumes, which increased by 67% in the reporting year. Data revenue was up 35% year-on-year to R4.4 billion, Cell C said.<\/p>\n
\u201cWhile we did see a marginal decline in traditional voice traffic, in favour of other voice technologies, this was offset by the massive data growth,\u201d said Dos Santos.<\/p>\n
Cell C also highlighed strong growth in its MVNO segment.\u00a0 Wholesale revenue increased 147% year-on-year to R370 million in revenue.<\/p>\n
EBITDA increased significantly by 59% to R3.1 billion during the year under review. EBITDA margin increased by 7% from 15% in 2015 to 21% in 2016 through a combination of increased revenue and cost management and savings initiatives.<\/p>\n
During 2016, Cell C said it invested approximately R3.4 billion in its network and other fixed and intangible assets, rolling out predominantly LTE and LTE-Advanced.\u00a0 Cell C\u2019s total capital expenditure over the last four years amounted to more than R11.6 billion.<\/p>\n
\u201cWe\u2019ve delivered on our promise to provide real value to consumers and despite already offering some of the lowest tariffs in the market, Cell C reduced the effective data rate by more than 20% during the last financial year,\u201d said Dos Santos.<\/p>\n
Operational highlights<\/strong><\/p>\n Cell C’s deal with JSE-listed Blue Label Telecoms inches nearer completion<\/a> after the latter company announced late last month that it has entered into a \u2018binding umbrella restructure agreement\u2019 with Cell C, debt providers of the mobile operator, a third party investor, and other relevant parties.<\/p>\n Bloomberg reported last week that Telkom was again considering a bid of $1 billion (around R13 billion) for Cell C. However, Cell C said it is committed to its deal with Blue Label, which was initially announced as far back as December 2015.<\/p>\n\n