{"id":47742,"date":"2013-10-17T00:03:10","date_gmt":"2013-10-16T22:03:10","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=47742"},"modified":"2013-10-17T10:12:28","modified_gmt":"2013-10-17T08:12:28","slug":"mtn-vs-vodacom-vs-telkom-how-much-are-they-really-making","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/telecommunications\/47742\/mtn-vs-vodacom-vs-telkom-how-much-are-they-really-making\/","title":{"rendered":"MTN vs Vodacom vs Telkom: how much are they really making?"},"content":{"rendered":"

South Africa’s largest telecoms giants have become some of the highest revenue-generating organisations in the country – but when it comes to bringing home the big bucks, mobile operators MTN<\/a> and Vodacom<\/a> have continued to excel, while fixed line\u00a0incumbent,\u00a0Telkom<\/a>, has fallen to historic lows.<\/p>\n

As predominantly mobile operators, MTN and Vodacom have ridden the wave of mobile growth in South Africa, while Telkom’s fixed-line business – which was once the main money-spinner for the telco – has dried up over the past 10 years.<\/p>\n

Looking at the mobile operators, both have grown into market listing superpowers with revenues exceeding R69 billion (Vodacom) and R135 billion (MTN) – but each company has taken a different approach to market.<\/p>\n

\"Vodacom<\/a>

Vodacom profit vs revenue<\/p><\/div>\n

While Vodacom remains the largest mobile network operator in South Africa, it’s closest local rival, MTN, has become an international giant, with 21 operations across Africa and the Middle East.<\/p>\n

Vodacom has focused a great deal of its business in South Africa, constrained somewhat by its parent\u00a0company, Vodafone, with only a handful of operations in Africa.<\/p>\n

In its last full year reporting (ended March 2013), Vodacom reported revenues of R69.917 billion, and operating profits of R18.97 billion – giving the company a profit margin of 27.13%.<\/p>\n

At the close of play on the JSE on Wednesday (16 October), Vodacom’s shares traded at a fraction of a percentage higher to R114.47, giving the company a market cap of R170.326 billion.<\/p>\n

\"MTN<\/a>

MTN profit vs revenue<\/p><\/div>\n

In its last full year reporting (ended of December 2012), MTN reported revenues of R135.112\u00a0 billion, and operating profits of R41.218 billion – giving the company a profit margin of 30.58%.<\/p>\n

At the close of play on the JSE on Wednesday (16 October), MTN’s shares were trading 1.58% higher to R202.90, giving the company a market cap of R381.874 billion.<\/p>\n

A look at the margins<\/h3>\n

Over the past decade, both MTN and Vodacom have seen continuous growth in revenue – and while both operators have seen operating profits flatten out, or even dip, over the course of the past decade, profit margins have remained in the double-digits.<\/p>\n

According to data taken from financial reports from 2002 to 2013 (MTN: 2012), the average profit margin maintained by Vodacom Group over the past decade sits at 23.67% – with the network’s highest margin recorded in 2013 (27.13%).<\/p>\n

MTN, on the other hand, saw its highest margins in 2005 to 2007 (31%), maintaining an average operating profit margin of 28.57% over the past decade.<\/p>\n

\"Telkom<\/a>

Telkom profit vs revenue (After 2007 Telkom altered its reporting structure to “operating revenue” and retroactively changed the values accordingly)<\/p><\/div>\n

Contrasting to the two mobile operators, incumbent fixed-line operator, Telkom, has seen its profit margins tighten over the past decade, as revenues slipped and profits evaporated amidst a rapidly declining fixed-line market.<\/p>\n

After reaching peak profits in 2006 (with a margin of over 30%), Telkom has since seen its profits shrink – right to the point of its last financial year (2013), where it recorded a paltry R501 million in profit (margin of 1.54%).<\/p>\n

At the close of play on the JSE on Wednesday (16 October), Telkom’s shares were trading 3.46% lower, down to R27.60, giving the company a market cap of R14.519 billion.<\/p>\n

\"Telkom<\/a>

Telkom vs MTN vs Vodacom<\/p><\/div>\n

More on SA telecoms<\/h3>\n

MTR price cuts: how it will affect Vodacom and MTN<\/a><\/strong><\/p>\n

MTR cuts would cost us R1 billion: MTN<\/a><\/strong><\/p>\n

Telkom expects jump in earnings<\/a><\/strong><\/p>\n

Operators mull action on termination rate cuts<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

South Africa’s largest telecoms giants have become some of the most revenue-spinning organizations in the country – but when it comes to bringing home the big bucks, some have fared better than others.<\/p>\n","protected":false},"author":14,"featured_media":46711,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[26,28,359,6853,65,27],"class_list":["post-47742","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-telecommunications","tag-headline","tag-mtn","tag-profit","tag-profit-margin","tag-telkom","tag-vodacom"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/47742","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=47742"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/47742\/revisions"}],"predecessor-version":[{"id":47772,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/47742\/revisions\/47772"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/46711"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=47742"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=47742"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=47742"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}