Vodacom reports H1 decline in earnings, rise in customers

Vodacom reports H1 decline in earnings, rise in customers

To play this media please enable JavaScript, and consider upgrading to a web browser that supports HTML5 media Telecommunications giant Vodacom posted a decline in profit, headline earnings per share (HEPS) and earnings per share (EPS) for the six months ended September 30, 2021, on a reported basis, while group revenue and earnings before interest, taxes, depreciation and amortisation (Ebitda) increased.

The company on November 15 reported a 5.1% decline in HEPS to 505c; however, when adjusted for the R805-million one-off deferred tax rate adjustment in the prior period, HEPS increased 3%.

EPS declined 5.4% on a reported basis to 504c during the six months under review.

Net profit from associates and joint ventures declined 36.1% to R1.6-billion, negatively impacted by the one-off deferred tax rate adjustment in the prior corresponding period and foreign exchange translation headwinds; however, on a normalised basis, this grew 11.9%.

Operating profit for the six months ended September 30, 2021, contracted 2.8% to R14.05-billion, representing an increase of 5.7% on a normalised basis.

Ebitda expanded 3.3% on a reported – 5.7% on a normalised – basis to R20.07-billion during the period under review.

Meanwhile, group revenue of R49.9-billion was up 4.2%, as strong normalised growth of 7.9% was partially offset by rand appreciation, while group service revenue increased 1% on a reported basis and 5.4% on a normalised basis to R38.91-billion.

“We now service 129.9-million customers across the group, including Safaricom on 100% basis, a gain of 6.2-million customers in the period,” said Vodacom Group CEO Shameel Joosub .

“Our new service offerings continue to grow, contributing to increasingly diverse revenue streams, while at the same time delivering innovative new products to our customer base.

He cited the growth of new services, which encompass financial and digital services, the Internet of Things and fixed, which accounted for 17.6% of group service revenue having generated R6.9-billion in the six-month period.

Financial services revenue, the largest component of new services, was up 10.9% to R3.7-billion. However, growth was impacted by the strong rand, and on a normalised basis, growth was up 22.7%.“Financial services is a clear strategic differentiator for the group and is integral to our purpose-led business model,” he said.In South Africa, Vodacom reported service revenue growth of 3.6% driven by connectivity demand, an additional 1.1-million data customers, incremental wholesale revenue and growth in its new services.“This was an impressive result given the demanding comparative associated with lockdowns in the prior period,” Joosub noted.Vodacom Business […]

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