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This has been an excellent year for
Vodacom, with our impressive
financial results achieved through the
successful execution of our strategy
underpinned by delivering on a
strong cost-efficiency drive.
This pleasing performance has been accompanied by
Vodacom securing an outright net promoter score (NPS)
lead over all our competitors in all our operations.
During the year, we completed the transformative
R42 billion acquisition of a strategic stake in Safaricom,
and in the same month we became the first (and
currently only) telecommunications company to list on
the Dar es Salaam Stock Exchange, a record-breaking
listing involving the participation of more than 40 000
Tanzanian investors.
This year, we improved our BEE score and achieved
a Level 3 BEE contributor status. This reflects our
commitment to implementing meaningful and
sustainable transformation.
South Africa
Our industry-leading application of Big Data and machine
learning, created to deliver personalised bundle offers
based on customer behaviour, continues to differentiate
us from our competitors. Through our ‘Just 4 You’
platform we have accelerated the uptake of bundle offers,
driving the sale of 2.3 billion bundles in the year, up
51.3%. Customers using bundles have grown 13.9%
to 18.7 million. Data bundles sold increased 54.7% to
766 million, with the average monthly data usage on
smartphones increasing 18.4% to 784 MB, driven in part
by a 44.8% increase in 4G customers to 7.3 million.
Enterprise service revenue grew 10.8%, and our Enterprise
mobile customer base increased 6.9% year-on-year to
1.3 million customers. We achieved impressive results
in growing our customer base through our segmented
propositions in the youth (Vodacom NXT LVL) and
emerging market (Vodacom Siyakha) segments. We more
than doubled the number of customers on our Youth
platform to 3.3 million, and saw 7.7 million low-income
customers on our Siyakha platform using Facebook flex in
the first year. Our financial services strategy is also gaining
momentum with our insurance direct recharge offering.
The 4.9% rise in service revenue growth is particularly
pleasing given the revenue impact associated with
reducing out-of-bundle data prices by as much as 50% in
October last year, as well as the early phase investments
in new revenue streams, including fibre, content
propositions and financial services. As part of our
commitment to democratising data, we have reduced our
effective rate for data by 21.6% year-on-year, and by
42.5% over the last three years. Our accelerated rural
coverage programme was instrumental in Vodacom
becoming the continent’s first operator to reach 80%
population coverage on a 4G network.
International
In our International operations, it was a particularly good
year for Mozambique and Lesotho, while our commercial
efforts in Tanzania and the DRC continue to show strong
momentum. This portfolio produced a 7.4% increase in
normalised service revenue on the back of rising
customer numbers, strong demand for data, and the
continued accelerated uptake of M-Pesa.
Revenue from mobile money continues to be a
significant contributor to the Group. The combined
customer base, including Safaricom, grew 11.5% in the
past year and now exceeds 32.3 million. During this
period, M-Pesa customers processed transactions worth
R1.3 trillion, making it the biggest mobile money
platform across the continent. The total transaction
revenue from M-Pesa across the portfolio is R10.2 billion,
which is significant. M-Pesa revenue is flying with a
growth rate of 30.4%* and 11.7 million customers in the
International portfolio, and 14.2% M-Pesa revenue growth
and 20.5 million customers in Safaricom.
Despite a turbulent political context, Safaricom delivered
net profit growth of 14.1% for the year, supported by
strong growth in data and M-Pesa revenues, and a 5.1%
increase in customers to 29.6 million. Vodacom’s portion
of the eight-month profit contribution from Kenya’s
leading telco was R1.5 billion.
We are seeing the benefits of our significant strategic
investment in Safaricom. As part of our commitment to
Shameel Aziz Joosub
CEO’s statement
06
Vodacom Group Limited
Integrated report for the year ended 31 March 2018