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Our 2023 reporting suite

Integrated report
9.22 MB
Consolidated financial
statements
1.12 MB
Environmental, social, and governance report
8.5 MB

Integrated report 2023

Introduction
Our governance
Our business
Our capitals performance
Additional financial information
Administration
Other documents
Excel documents
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Introduction
About our report
Who we are
Where we operate
Our material matters
Our value creation in practice
Our governance
Chairman’s statement
Who governs us
Board governance at a glance
Who leads us
Our business
CEO’s statement
Our approach to ESG
Our approach to value creation
Our strategic ambitions
Measuring our value creation
What we offer
Our profit formula
Our investment case
Our principal risks and associated opportunities
Responding to “Hot topics” impacting our operating context
Our capitals performance
Our business model
Our trade-offs
Financial capital
Condensed financial statements
Manufactured capital
Intellectual capital
Social and relationship capital
Natural capital
Human capital
Remuneration to reward value creation
Additional financial information
Five-year historic review
Five-year historic review per segment
Share information
Administration
Disclaimer
Glossary
Corporate information
Consolidated financial statements
Directors’ statement of responsibility
Certificate by the Company Secretary
Independent auditor’s report on the consolidated financial statements
Directors’ report
Report of the Audit, Risk and Compliance Committee
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Separate financial statements
Separate income statement and separate statement of comprehensive income
Separate statement of financial position
Separate statement of changes in equity
Separate statement of cash flows
Notes to the separate financial statements
Addendum A
Interest in material subsidiaries, associates and joint ventures and structured entities

Our reporting suite

Integrated
report
Environmental, social
and governance report
Corporate
governance report
Tax transparency
report
Annual consolidated
financial statements

Vodacom is a leading and purpose-led African connectivity, digital and financial services company. The Group, including Safaricom, serves 186 million customers spanning across the consumer and enterprise segments. From our roots in South Africa, we have grown our business to include operations in Tanzania, the DRC, Mozambique, Lesotho, Kenya, Ethiopia and now Egypt. Our mobile networks cover a total population of over 500 million people. Through Vodacom Business Africa (VBA), we offer business-managed services to enterprises in 47 countries. Vodacom is majority-owned by Vodafone (65.1% holding), one of the world’s largest communications companies by revenue.

South Africa

Tanzania

DRC

Mozambique

Lesotho

Egypt

Kenya

Ethiopia

Our approach to value creation

1 Africa’s leading communications company Diversify and differentiate with our digital ecosystem Optimised, future-ready TechCo 2 3 Enables Affects Drives Influences Impacts Informs Draws from Influences Strategic ambition Our capital performance Our purpose pillars Click here for more on our strategic ambitions and the strategic pillars that support them. For more information on our capital inputs and outputs, refer to our business model. Our key relationships Our principal risks and associated opportunities “Hot topics” impacting our operating context Our trade-offs Our material matters Refer to Our capital’s performance, for more information. Digital societyConnecting people and things to the internet Inclusion for allA digital future that is accessible to all PlanetReducing our environmental impact Our context Our capital performance Our system of advantage Why we exist Connecting for a better future. Our purpose Our execution of the System of Advantage draws from all six capitals. Our material matters encapsulates the matters that have the potential to affect the value we create over time. For more information refer to: Our performance against the six capitals forms the basis of our performance review. Our capitals are the resource and relationships we rely on. The success of our business depends on our ability to respond and adapt to our operating context.

Governance oversight and responsible business practices

Good governance, acting ethically, lawfully and with integrity, forms a critical part of sustainable value creation and our long-term success.

“Vodacom’s success is built around its ability to address customer needs through its products and services”.

Saki Macozoma

Chairman’s statement

Our relentless pursuit of purpose

Our relentless pursuit of connecting for a better future encapsulates where we intend to make a difference in our markets. In line with this and our focus on ESG, the Board oversees the Group’s efforts to continue developing future-ready products and services that connect Vodacom customers for a better future; the contributions made to sustainable socio-economic development across our markets; the enhancement of financial inclusion; and the promotion of equal digital access.

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Governance

“At the core of our strategy is our vision of becoming a leading African TechCo.”

Shameel Joosub

Strategic review

CEO’s statement

System of Advantage

Despite ongoing macrochallenges, FY2023 was characterised by the successful execution of our strategy – the System of Advantage – which continues to create sustainable value for our stakeholders. The tangible progress we made this year is a source of immense pride and the culmination of many years of planning and preparation as we continue to work to connect people for a better future.

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Strategic ambitions

"We have upgraded our medium-term targets to reflect Vodacom’s enhanced growth and return potential".

Raisibe Morathi

Financial review

CFO’s statement

Dear stakeholders

It gives me great pleasure to present satisfactory financial results despite having experienced a year defined by global macroeconomic challenges and inflationary pressures. This uncertain context was largely fuelled by fragmented economic recovery after the COVID-19 pandemic and new challenges such as the war in Ukraine. The power crisis in South Africa, higher interest costs, start-up losses in Ethiopia, M&A costs, and higher inflation across our markets contributed to muted net profit growth of 2.1%.

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Our value creation in practice

Financial Capital FC icon
Group service revenue growth of
17.2%
Group revenue of
R119.2 billion
(FY2022: R102.7 billion)
Human Capital HC icon
Invested
R553 million
in employee skills development across our markets (excluding Vodafone Egypt)
(FY2022: R493 million)
Intellectual Capital IC icon
Acquired 110MHz of spectrum in Tanzania and finalised the purchase of additional spectrum in Mozambique
Manufactured Capital MC icon
Acquired a majority share in Vodafone Egypt
R16.5 million
capital investment in network capacity and resilience
(FY2022: R14.6 million)
Natural Capital NC icon
39%
reduction in GHG emissions per terabyte of data
(FY2022: 15% reduction)
Social and relationship capital SRC icon
Contributed to transformation in South Africa
Level 1
Broad-based black economic empowerment (B-BBEE) contributor status
(FY2022: Level 1)
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Share information
Measuring value creation image

Measuring our value creation

In a year with several strategic milestones, we continue to accelerate our powerful, multiproduct strategy – the System of Advantage – to differentiate our Group in our selected markets, set us apart from competitors and deliver superior returns to our stakeholders.

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Responding to

“Hot topics” impacting our operating context

“Hot topics” are top of mind in our conversations with our stakeholders. Our understanding of these hot topics informs our materiality process, helping us to articulate the key issues that affect our ability to create value over time.

Hot topics image

Forces shaping our macroenvironmental context

Our presence in multiple markets exposes us to several global trends impacting our operating environment. The success of our business depends on how we respond and adapt under these circumstances. Our System of Advantage and purpose enables us to capture opportunities and mitigate risks, creating sustainable value for our stakeholders.

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A global energy crisis

Context and key developments

Energy availability is at risk globally from both an electricity and fuel supply perspective. Fuel price inflation, which spiked in the first half of the year, negatively impacted our cost base across our markets. In South Africa, this was exacerbated by loadshedding, which negatively impacted economic growth. The energy crisis has increased calls for the use of renewable energy and emphasised the need to reduce energy consumption across industries and households.

Our response
Prioritising network resilience capital expenditure above network expansion
Increasing our use of renewable energy
Increasing our energy efficiency

RemCo chairman statement

Dear stakeholders

I am pleased to present this snapshot of our approach to remuneration and outcomes for FY2023. Our remuneration practices are intrinsically linked to our commitment to value creation. We believe centring remuneration around our purpose and creating incentives that support our strategy, creates value for all our stakeholders.

Phuthi Mahanyele-Dabengwa
RemCo Chairman

RemCo Chairman image
Remuneration report

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Introduction
About our report
Who we are
Where we operate
Our material matters
Our value creation in practice
Our governance
Chairman’s statement
Who governs us
Board governance at a glance
Who leads us
Our business
CEO’s statement
Our approach to ESG
Our approach to value creation
Our strategic ambitions
Measuring our value creation
What we offer
Our profit formula
Our investment case
Our principal risks and associated opportunities
Responding to “Hot topics” impacting our operating context
Our capitals performance
Our business model
Our trade-offs
Financial capital
Condensed financial statements
Manufactured capital
Intellectual capital
Social and relationship capital
Natural capital
Human capital
Remuneration to reward value creation
Additional financial information
Five-year historic review
Five-year historic review per segment
Share information
Administration
Disclaimer
Glossary
Corporate information
Consolidated financial statements
Directors’ statement of responsibility
Certificate by the Company Secretary
Independent auditor’s report on the consolidated financial statements
Directors’ report
Report of the Audit, Risk and Compliance Committee
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Separate financial statements
Separate income statement and separate statement of comprehensive income
Separate statement of financial position
Separate statement of changes in equity
Separate statement of cash flows
Notes to the separate financial statements
Addendum A
Interest in material subsidiaries, associates and joint ventures and structured entities

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