South African cellular operator Vodacom, in which Telkom has a 50% holding, on Monday reported a 20,3% rise in revenue to R13,594-billion for the six months ended September 30, while earnings before interest, tax, depreciation and amortisation increased by 13,4% to R4,192-billion.
Profit before tax increased by 18,7% to R2,555-billion. The group reported a 40,6% rise in total customers to 13,5-million. In South Africa, it recorded a 33,1% rise in subscriber base.
The majority of the growth came from the pre-paid market, although “remarkable growth” was also achieved in the contract market.
During the period under review, the company secured access to Vodafone Live! through its 35% shareholder Vodafone Group plc, and announced that the third-generation (3G) technology roll-out is under way. South African subscribers in major metropolitan areas will have access to 3G before Christmas.
The signing of the Vodafone Affiliate Partner agreement, announced earlier this month, promises to provide Vodacom with competitive advantage in the mobile content arena.
The developing market has been a driving force behind market penetration in South Africa and made up 88,7% of all gross connections.
Due to the high cost of acquisition in the highly developed contract market, Vodacom’s focus on upgrade and retention policies ensured the further decrease in contract churn to the lowest level in the group’s history of 8,6% during the period under review.
Vodacom is assessing the impact of the determinations announced by Minister of Communications Ivy Matsepe-Casaburri earlier this year. The group is developing strategies to best deal with the changes and to take advantage of any opportunities.
The group’s interconnection revenue increased to R2,9-billion from R2,8-billion.
Looking ahead, the group said it has performed well in a competitive African market. The performance of the South African market continues to be strong and management believes that Vodacom’s alliance with Vodafone gives it a competitive advantage.
Vodacom continues to be confident of success in all its operations despite a challenging environment. In South Africa, Vodacom intends to position itself strategically to minimise any negative impact from the pending deregulation of the South African market and to seize any opportunities that may emerge. — I-Net Bridge