Telecoms giant Vodacom has grown their customer base by 2.3 million users
Listed telecoms giant Vodacom, buoyed by the recent acquisition of Kenyan mobile operator Safaricom for R35billion, has set its sights on growing its footprint in the rest of Africa as its home market subscriber number surged by 2.3million to 39million in the quarter to June.

In total the group added 2.5million customers in the period, 280000 in its international operations to reach a total customer base of more than 70million across the group.

Shameel Joosub, Vodacom Group chief executive, said although its international operations had turned the corner, currency volatility was still negatively impacting the translation of its results.

“We now have 30million customers outside of South Africa, an increase of 12percent. Following the shareholder approval of the acquisition of a stake in Safaricom on July 18, this will further boost contribution outside of South Africa,” Joosub said.

Earlier this week the company said its minority shareholders had approved its deal to acquire 34.9percent of Safaricom in a transaction that would see Vodafone increase its interest in the Vodacom Group to 69.6percent.

Safaricom provides a range of telecommunications services, including mobile and fixed voice, SMS, data, the internet and mobile money (M-Pesa) to more than 28.1million customers. Its M-Pesa service reaches more than 19million customers.

The company said yesterday that its deal with Safaricom was expected to be effective from the beginning of next month. It cancelled the M-Pesa offering in South Africa last year after the service proved to be unpopular with customers, but said the service continued to make attraction in its other African markets.

The group’s M-Pesa international offerings revenue increased 7.4percent, with normalised growth of 24.9percent. It attributed this growth to the addition of 350000 new customers in the quarter to reach a total of 13.3million customers.

Joosub said the company would continue to enhance its service and product eco-systems and develop innovative products to improve customer experience. “In Tanzania, 1million customers are using our successful M-Pawa savings and loans product, developed in partnership with the Commercial Bank of Africa.

“There has also been a steady uptake of our International Money Transfer services. During the quarter, on average, R22bn was processed monthly through the M-Pesa system.”

In the quarter under review, the group’s revenue grew 3.9percent to R20.7bn, while its service revenue grew 1.7percent to R17.1bn.

It said its South African revenue growth accelerated to 7.8percent in the period, supported by stronger device sales. However, the international revenue declined 8.2percent and service revenue declined 8percent, while normalised for currency fluctuations, revenue and service revenue increased 8percent in the period under review.

The group sold 553million prepaid and contract bundles in the quarter, up 68.3percent, with the number of bundle users increasing by 25.7percent to 17.8million. Its South African data revenue grew 18.1percent to R5.5bn, contributing 42.2percent of the group’s total service revenue in the period.

It said it added 463000 4G customers in the quarter, reaching a total of 5.5million customers as devices became more affordable.

Data revenue from its international operations grew by 2.2percent, with normalised growth of 18.9percent, supported by an increase of 810000 data customers, up to 13.8million, while data traffic grew 87percent. Data revenue comprised 27.1percent of international operations’ service revenue.

Joosub said the company would continue to make substantial investments in all its operations so that it maintained its network lead and information technology advantage

“We remain cognisant of the weaker economic conditions that prevail in South Africa as well as some of our larger markets and have put measures in place should these conditions deteriorate materially in these markets.”


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