African operator group Vodacom trumpeted a 5.1 per cent increase in service revenue in the quarter to 30 June 2015, which Shameel Joosub, its CEO, described as “a continuation of the positive growth momentum”.
Service revenue increased to ZAR15.66 billion ($1.26 billion), of which the lion’s share (ZAR11.76 billion) came from its home market of South Africa. Total revenue increased 7.0 per cent year-on-year to ZAR19.56 billion.
Group data revenue increased by 35.2 per cent to ZAR4.85 billion, representing 30.9 per cent of service revenue, with growth coming both from South Africa and Vodacom’s other markets. But voice revenue is pressured in its home market, leading to a 5.9 per cent decrease at a group level to ZAR8.04 billion.
Active customers across the group increased by 6.5 per cent to 63.5 million. Active data customers grew by 10.8 per cent to 28.0 million.
“We invested another ZAR2.4 billion in the network this quarter as part of the accelerated capital investment programme started towards the end of the 2014 financial year, resulting in wider coverage and faster connection speeds”, Joosub said.
Investment was focused on 4G rollout and expanding 3G coverage.
Service revenue growth of 2.8 per cent in South Africa came after four quarters of negative performances, which had been heavily impacted by mobile termination rate cuts. The company is “nearing completion of our pricing transformation programme” in the country, leading to a reduction in pricing for voice and data services, which was offset by growth in consumption.
International service revenue increased 12.9 per cent to ZAR3.95 billion, representing 25.2 per cent of Vodacom group service revenue. This was supported by an 11.5 per cent increase in the customer base to 30.2 million.
It said the pricing environment in Tanzania has stabilised, “supporting stronger service revenue growth as we migrate customers to integrated bundles and drive increased data adoption”.
In Democratic Republic of Congo, it saw an “encouraging increase in service revenue”, as operators adhered to a minimum price floor, and Vodacom implemented a new approach to customer segmentation with simpler price points.
And Mozambique and Lesotho continued to deliver strong growth.
by Steve Costello