Cell C users up 34%, earnings down

South Africa’s third-largest wireless firm Cell C reported a 34% jump in subscriber numbers in 2008, but its earnings fell in a tough market dominated by mobile operator Vodacom.

Cell C said total subscriber numbers grew 34% to 6,4 million in 2008.

It also said full-year earnings before interest, tax, depreciation and amortisation was at R812-million, but this reflected a decline compared to more than R1-billion in 2007.

Unlisted Cell C, in which Saudi Arabian group Saudi Oger holds a majority stake, said revenue rose 14% to R8,6-billion.

“The results are positive, given the tough economic environment, and the pressure on consumers’ personal budgets and disposable income,” Cell C outgoing chief executive Jeffrey Hedberg said in a statement on Tuesday.

He said the company’s strategy was paying handsome rewards as the operator declared increases in customers and revenue.

Simon Duffy, chairperson of Cell C’s board, said Cell C’s shareholders are fully committed to the company and would continue to invest in its success.

In a competitive South African market, Cell C competes with Vodacom, which is due to be listed in Johannesburg on May 18, and MTN, Africa’s largest mobile phone operator.

MTN said on Monday that in South Africa its customers had risen 2% to 17,4 million in the first quarter this year, while Vodacom had 26,45 million users in the nine months to the end of December last year.

Vodacom is majority-owned by UK’s Vodafone, which wants to use the South African firm to expand in Africa.—Reuters