Vodacom’s sustained investment in customer and network experience surprisingly attracted 8.4 million new customers in the year to end-March 2018, reassuring investors that the mobile phone company is still a good investment.
The Vodafone-owned company said on Monday that its South African operation added 4.5 million new subscribers, and international operations contributed 2.5 million new users. While Kenya’s Safaricom added 1.4 million customers.
The South African-based mobile phone provider now has more than 103 million customers.
“This has been an extraordinary year for Vodacom,” Shameel Joosub, Vodacom Group CEO said.
“In addition to completing the acquisition of a strategic 34.94% stake in Safaricom and a record-breaking listing in Tanzania, over 8.4 million customers joined the Vodacom and Safaricom networks.”
The company said group revenue grew strongly at 6.3% to R86.4 billion; normalised growth, excluding currency translation effects, was 7.8%.
“Our investment and efforts to drive revenue diversification and digital transformation across the group are having the desired effect,” Joosub said. “Changing the way we operate, means we are well positioned to drive new and exciting growth opportunities as we seek to change people’s lives through building a connected society.”
Safaricom contributed R1.5 billion profit for the eight months since acquisition, after deducting the amortisation of fair valued assets and before minority interest.
Net profit increased 18.6%, boosted by the Safaricom acquisition and by the profit from the sale of Helios Towers Tanzania Limited.
The company’s headline earnings per share (HEPS) remained constant at 923 cents per share, impacted by shares issued to acquire the Safaricom stake.
HEPS is South Africa’s main profit gauge.
During this period, the M-Pesa platform in Vodacom’s international operations, processed transactions worth $1.9 billion, generating a 19.6% increase in M-Pesa revenue to R2.3 billion. In addition, Safaricom showed impressive results processing $6.5 billion worth of transactions for the year.