Vodacom Group Wobbles Against Economic Pushbacks
Major subsidiary of global telecoms group, Vodacom has delivered a 4.7% increase in normalised revenue, to R30.7-billion, in the quarter ended 31 December 2022.
Vodacom Group delivered a 4.7% increase in normalised revenue, to R30.7-billion, in the quarter ended 31 December 2022, despite being a period that saw the worst power cuts in South Africa’s history.
The figure was up 14.8% when not normalised for exchange rate fluctuations and the impact of the R43.6-billion acquisition of a 55% controlling stake in Vodafone Egypt, which was consolidated on 8 December.
Group service revenue was up 16.1% (3.5% normalised), supported by growth in data revenue and financial services. South African service revenue rose 3% on surprisingly robust prepaid performance. Non-South African service revenue jumped 18% (4.5% normalised), driven by the weaker rand and strong demand for data services. The 4.7% increase in normalised group revenue … underscores the ongoing resilience of the group’s portfolio
Read also Nigerian Mobility Fintech Startup Shekel Mobility Raises $1.95M In Pre-Seed Funding
Financial services revenue increased 30.6% (16.5% normalised) to R2.6-billion, with downloads of the VodaPay “super app” reaching 4.5 million.
“The 4.7% increase in normalised group revenue, which strips out currency fluctuations and the impact of Vodafone Egypt’s acquisition, underscores the ongoing resilience of the group’s portfolio at a time when economic uncertainty prevails in the face of the war in Ukraine and the supply-chain impacts of the Covid-19 pandemic,” said Vodacom Group CEO Shameel Joosub in a statement.
South African service revenue rose by 3%, down marginally from the 3.1% result in the second quarter, as the result of higher investment in network capacity coupled with higher customer engagement. Capital expenditure in the three-month period came to R2.7-billion, a 15.6% uplift compared to the same period a year ago.
South African mobile contract revenue increased by 3.1% to R5.7-billion, helped by price increases earlier in the year. Average revenue per contract customer was flat at R299, while the contact base grew by 4.6% to 6.7 million.
Read also Kenyan Microfinance Kuscco Sells Its Software Publishing Company To Fintech Startup Kwara
Prepaid on the rise
The prepaid segment did surprisingly well, given the tough economic conditions in South Africa, with mobile prepaid revenue growth accelerating to 3.7% from 2.7% in the second quarter. Vodacom attributed this to network availability and a successful summer marketing campaign. Prepaid average revenue per user in South Africa came in at R61, up 7%. Prepaid subscriber growth was, however, impacted by a clean-up of 1.1 million non-revenue-generating Sim cards.
The average usage per smart device increased 27.4% to 3.2GB/month in South Africa, while the number of 4G/LTE devices on the network rose by 11.4% to 19.2 million. Prepaid data revenue of R3-billion was up 14%.
Service revenue from financial services was up 12.6% to R779-million, with the customer base reaching 14.7 million. “Revenue growth was supported by our insurance portfolio, with the number of policies up 11.1% to 2.6 million. Our Airtime Advance product remained a key contributor to financial services revenue and posted a pleasing acceleration in the third quarter. We advanced R3.4-billion in airtime, amounting to 45.1% of total prepaid recharges.”
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry