Vodacom reports strong revenue growth in last quarter of 2023

Vodacom CEO Shameel Joosub. File photo: Simphiwe Mbokazi/Independent Newspapers

Vodacom CEO Shameel Joosub. File photo: Simphiwe Mbokazi/Independent Newspapers

Published Feb 5, 2024


VODACOM Group increased revenue by a whopping 26.8% to R38.9 billion in the quarter to December 31, boosted by the acquisition of Vodafone Egypt.

Group service revenue growth, including Vodafone Egypt on a pro-forma basis, was 8.8%, at the higher-end of the group medium-term target, the group said in a trading update on Friday.

Customers across the group, including Safaricom, reached 200 million for the first time with more than 75 million of the customers using a financial service.

Vodacom CEO Shameel Joosub said in a statement: “During the third quarter Vodacom Group celebrated a number of key milestones including Vodacom Mozambique's 20-year anniversary, the trial of 5G in the DRC and the announcement of Project Kuiper, a collaboration with Amazon's low Earth orbit satellite (LEO) communications initiative.”

Project Kuiper added to the group’s satellite partnerships and would extend the reach of 4G and 5G services to more customers in Africa and in particular in areas that may otherwise be operationally challenging or prohibitively expensive to serve via traditional fibre or microwave solutions.

South Africa service revenue grew only 1.9% in the quarter, but it was compared against a strong comparative period in the prior year.

Egypt grew service revenue 29.1% in local currency, with Egypt financial services customers up 55.5% to 7.5 million.

International service revenue increased 10.7% after network investment accelerated data revenue growth.

Financial services revenue increased 31% to R3.4bn, with $98.2bn transacted through the mobile money platforms in the quarter.

Vodafone Egypt Telecommunications SAE (Egypt) was consolidated from December 8, 2022.

Joosub said after operating in Mozambique for two decades, its anniversary highlighted the contribution Vodacom had made to digital and financial inclusion in the country.

Vodacom Group, including Safaricom, had reached the 200 million customer mark for the first time, having reached 100 million customers in 2018.

In Egypt, local currency revenue growth of 31.5% was underpinned by a strong performance from mobile data, fixed and financial services, including a 40.7% improvement in data traffic.

In South Africa, revenue growth came to 4%, which the management said was satisfactory considering the strong comparative as a result of heightened load shedding in the prior year quarter.

Across the International business segment, network investment contributed to a 25.4% increase in 4G sites, which supported an acceleration of local currency revenue growth.

“As we combine network investment with our focus on digital inclusion and pioneering handset financing and rural coverage models, we expect these will unlock further meaningful growth opportunities across our eight markets,” Joosub said.

Revenue from new services - financial and digital services, fixed and IoT - were on track to reach a targeted contribution of 25-30% over the medium-term.

The contribution of new service revenue exceeded 20% for the first time, to R6.2bn. Financial services was the biggest component, having grown 31% to R3.4bn in the quarter, largely on the back of scaling new products and strong customer growth of 12%.

“We remain Africa's largest mobile money platform by transaction value processed, with a value of close to $100bn (R1.9 trillion) in the quarter. Our super-app roll-out across the footprint remains a major focus,” said Joosub.

In South Africa, VodaPay reached 4.8 million users.

“Looking ahead, we are alert to the financial constraints on customers caused by the high cost of living and we remain committed to delivering innovations that enhance the value we deliver to customers to help alleviate cost of living pressures,” the group said.

Joosub said their business model would continue to demonstrate resilience.