Vodacom Group said on Friday that despite the ongoing uncertainty impacting global markets and economies its revenue increased by 36.9% .
In its trading statement for the quarter ended June 30, 2023, the mobile operator said group revenue increased 36.9% to R35.7 billion, positively impacted by the acquisition of Vodafone Egypt and rand depreciation against its basket of international currencies.
Vodacom reported that group service revenue was up 43.8%, or 9.8%, excluding Vodafone Egypt. South Africa service revenue grew 3.9%, underpinned by the contract segment, fixed and financial services.
“International service revenue increased 23.8%, driven by data revenue growth and a weaker rand. Vodafone Egypt grew service revenue by 27.6% in local currency, as financial services revenue more than doubled. Group service revenue growth including Vodafone Egypt on a pro forma basis was 9.0%, at the higher end of our medium-term target," it said.
Financial services revenue increased 46.2% to R3 billion, with $1bn (R18bn) per day transacted on its mobile money platforms.
Vodacom Group CEO Shameel Joosub said: “In South Africa, our R4.0 billion investment over four years to mitigate the impacts of load shedding continues to pay dividends.
“We now invest more than R11bn a year into our South Africa infrastructure alone, which has resulted in industry-leading network availability during elevated levels of power outages and ultimately contributed to the 3.9% increase in service revenue in our largest market.”
Joosub said Vodacom responded to South Africa's power crisis with increased investment in power resilience and meaningful engagement with stakeholders.
“We welcome the government's block exemptions for energy users and suppliers, which enables more efficient procurement and use of backup energy solutions.”
Vodacom said it was confident that its electricity wheeling agreement with power utility Eskom would be signed off in the near term and that this would have a positive impact on the country's power grid and renewable energy mix.
Wheeling is the delivery of energy from a generator to an end-user located in another area through the use of existing distribution or transmission networks.
From a mergers and acquisitions perspective, Joosub said it awaited regulatory approval for our proposed acquisition of a joint venture the stake of up to 40% in Maziv, which will accelerate fibre reach in South Africa, fostering economic development and helping bridge South Africa's digital divide.
Looking ahead, Joosub said: “We are fully cognisant of the financial constraints on customers caused by global economic uncertainty and increased inflation. We remain committed to delivering innovations that enhance the value we deliver to customers and helping to alleviate cost of living pressures.”
“I firmly believe that the continued execution of our strategy has the potential to create immense economic value in the markets where we operate, helping to address inequality. By providing access to a smartphone, financial services, healthcare, and education to every person across our markets we will fulfil our purpose,” he said.
The share price on Friday closed 0.03% lower at R113.03 on the JSE.
Ashburton Investments Senior Portfolio Manager Wayne McCurrie @WayneMcCurrie said on Twitter, “Vodacom trading update 3m to June. Did acquire Vodacom Egypt but still reasonable results. Only revenue update, no cost/profits.”
BUSINESS REPORT