South African telecommunications group Telkom on Monday reported a 53% increase in its basic earnings per share for the year ended March 2005 to 1 241,8 cents, from 812 cents in the previous comparative period.
Profit for the period increased to R6,807-billion, from R4,592-billion in the 2004 financial year.
Telkom declared a final dividend per share of four rand and a special dividend per share of five rand.
The group’s operating revenue totalled R43,117-billion, from R40,484-billion previously.
Operating profit was R11,222-billion, from R9,245-billion in 2004.
“Telkom’s net profit growth was derived from the acceleration in the uptake of data services, robust growth in Vodacom’s South African customers, efficiency gains and reduced finance charges,” Telkom CEO Sizwe Nxasana said.
Increases in fixed-line prices contributed an estimated R224-million, or 10% of the R2,2-billion growth in net profit.
The fixed-line business posted modest growth in revenue of 1,6% as a result of low effective tariff increases and declining voice volumes.
This was offset by the increasing adoption of data services in consumer and small and medium business markets.
Significant progress was made in improving the competitiveness of the fixed-line segment through ongoing rationalisation and improving employee productivity, Telkom said.
Vodacom achieved in South Africa and other African countries an increase of 38% in customers and gross connections of 7,8-million, Telkom added.
During the year, Vodacom launched its 3G Vodafone Live! services and the GPRS Blackberry product.
Driving greater adoption of data services across all markets, Telkom grew fixed-line data revenue by 15,6% during the year ended March 31.
In the consumer and small business market, ADSL adoption accelerated as a result of extensive marketing campaigns, new lower-speed ADSL products and reduced tariffs.
These include the expansion of the Telkom internet powered by ADSL-service with two reduced-cost, lower-speed services, and the launch of a four-port Ethernet interface router and a 24-month ADSL contract bundled with a free modem.
The number of ADSL customers increased by 188,2% to 58 532 and the number of Telkom internet subscribers grew by 49,4% to 225 280, of which 10,2% are broadband customers.
Investment in the evolution of Telkom’s network is a key imperative to transform Telkom from its time division multiplex network to an internet protocol-based next-generation network, the group said.
During the period under review, R402-million (2004: R390-million) was spent on training and development of fixed-line employees, totalling 224 662 training days.
Vodacom’s exceptional performance and customer growth once again exceeded expectations, further demonstrating the robust growth of the cellular industry in South Africa and Vodacom’s ability to maintain its leadership position in this market.
Vodacom South Africa added gross connections of 6,2-million customers, the highest level to date, and increased market share to an estimated 56%.
Vodacom continued to focus on customer care and retention, which saw contract-customer churn at 9,1%.
Vodacom grew data revenues by 28,8% to R1,340-million (Telkom’s 50% share is R670-million), largely as a result of the strong growth in SMSs transmitted.
Vodacom grew its customer base in other African countries by 77,3% to 2,6-million, from 1,5-million in 2004.
Despite a fiercely competitive environment, Vodacom Tanzania grew its customer base by 75,6% to 1,2-million and extended its market share to 59%, further entrenching its leadership position.
Vodacom Congo maintained its market share at an estimated 47% and grew its customer base to one million. The investment in Mozambique is slowly making inroads with 265 000 customers. — I-Net Bridge