Vodacom’s acquisition of Safaricom pays dividends

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Vodacom has released its annual results for the year ended 31st March and, to quote chief executive officer Shameel Joosuub, “this has been an extraordinary year for Vodacom”.

Group revenue grew substantial by 7,8 percent (normalised for currency translation effects) with service revenue up by 3,4 percent, or 5,1 percent when normalised. Group revenue currently amounts to R86,4 billion.

This growth is thanks in part to some 7 million new customers joining Vodacom, 4,5 million from South Africa and 1,5 million from other regions.

Last year Vodacom completed an acquisition of Kenyan mobile operator, Safaricom. That acquisition means that through Safaricom, Vodacom added an extra 1,4 million customers to its group figures. In total Vodacom now serves 103 million customers.

In South Africa data continues to prove itself a big money maker. Data revenue grew 12,8 percent year-on-year to R12,4 billion, which accounts for 42,8 percent of service revenue. Overall 766 million bundles were purchased throughout the last financial year.

Vodacom reports that 18,7 million customers are now using bundles, a 13,9 percent increase year-on-year.

While headline earnings per share remained flat at 923 cents, dividends per share fell 1,8 percent to 815 cents.

Vodacom has done well but it does note that the economic environment of the last year made it tough for business. Despite the last year, the firm is hopeful for 2018.

“We are encouraged by the renewed economic and political stability in South Africa and most of our International operations, including Kenya. Stability in foreign exchange and macroeconomic environments benefits our operations and is expected to support more predictable results across our operations. However, unexpected volatility in the political environment, currency and regulatory uncertainty continue to pose a risk,” Vodacom said in a statement.


Brendyn Lotz

Brendyn Lotz

Brendyn Lotz writes news, reviews, and opinion pieces for Hypertext. His interests include SMEs, innovation on the African continent, cybersecurity, blockchain, games, geek culture and YouTube.