Vodacom Integrated Report 2018

53 / 98

expanding consumers’ payment options. In
Tanzania, we have introduced lipa kwa M-Pesa, our
merchant payment solution, which is showing very
strong merchant take up. This platform gives
customers the convenience to transact with
M-Pesa at more points of sale. The equivalent of
over USD160 million was transacted through this
system this year. In Mozambique, we have
expanded our agent network to more than 20 000
agents, while in the DRC and Lesotho we continue
to incentivise customers to increase uptake. On
average, USD1.9 billion was processed monthly
through the M-Pesa system.
The EBITDA margin improved 2.0ppts, while EBIT
increased 27.2% (26.5%*) to R2.1 billion, and EBIT
margin expanded by 2.5ppts to 12.0%. We have
entrenched a culture of strong cost containment in
Safaricom
During the year, we concluded our acquisition of a 34.94% indirect
stake in Safaricom, the number one mobile operator in Kenya. In the
eight months since acquisition, Safaricom has contributed a profit of
R1.5 billion which represents the net amount of earnings from
Safaricom of R1.9 billion and an amortisation charge of R383 million
in relation to fair valued assets and before minority interest.
Safaricom finished the year with great momentum, reporting annual
service revenue growth of 10.0% to KES225 billion and EBIT growth of
12.6% (18.3% excluding a once-off adjustment in the prior year relating
to a KES3.4 billion excise duty refund) to KES79 billion. Underpinning
the results was strong expansion of Safaricom’s customer base by 5.1%
to 29.6 million customers. Strong growth in both data and M-Pesa
revenue continues as data customers increased by 6.2% to 17.7 million
customers, and 30-day active M-Pesa customers increased 8.0% to
20.5 million. M-Pesa revenue grew 14.2% while data revenue grew by
24.0%. M-Pesa revenue contributed 28.0% to service revenue, while
data revenue contributed 16.2% to service revenue. Investment in
capital expenditure of KES36.4 billion resulted in 3G sites increasing
18.9% and 4G sites increasing 49.4% year-on-year.
These results are available on
relation/financials/reports/financial-results.
International
Year ended 31 March Year-on-year % change
2018 2017 Reported Normalised*
Service revenue (Rm) 16 828 16 775 0.3 7.4
Revenue (Rm) 17 460 17 350 0.6 7.9
EBIT (Rm) 2 096 1 648 27.2 26.5
EBITDA (Rm) 4 930 4 545 8.5
Data revenue (Rm) 2 429 2 168 12.0
M-Pesa revenue (Rm) 2 327 1 945 19.6
Capital expenditure (Rm) 2 707 2 833 (4.4)
Customers1 (thousand) 32 194 29 655 8.6
Data customers2 (thousand) 16 573 12 997 27.5
all our operations, leveraging from programmes
such as ‘Fit for growth’. Improved revenue growth,
savings on commissions from airtime purchases
through M-Pesa, continued savings in network
operating expenses, and improving foreign
exchange rates, are key drivers for margin growth.
Capital expenditure of R2.7 billion was focused on
improving customer experience on our networks by
extending voice and data coverage, improving data
network speeds and investing in Business
Intelligence tools to drive growth. We rolled out
additional 4G sites in Tanzania and Lesotho and
expanded 3G coverage in the DRC and Mozambique.
As part of our digital transformation, we continue
to invest in enhancing our IT systems to support
our personalised pricing offers and to deliver on
our segmentation strategy.
49
Our business Our performance Our governance Administration