South African mobile telecoms operator Vodacom Group said on Monday, May 10, it has upgraded its long-term subscriber growth target after adding millions of subscribers last year.
The Africa-focused group, which is majority-owned by Britain's Vodafone, cited momentum in its core mobile business and fast-growing financial services operations.
Vodacom said it now aims to grow its total customer base to 275 million by the 2030 financial year, up from a previous target of more than 260 million, after its customer base reached 237.3 million in the year ended March 31.
Vodacom has been strengthening its position in financial services, recently increasing its stake in Kenya's largest mobile operator Safaricom, in which it already owns 39.9%.
Chief Executive Shamil Josoub said in a media call that the increased stake, which will give Vodacom effective control, will help accelerate the rollout of payments and lending app M‑Pesa beyond its most mature markets, particularly Kenya and Tanzania.
Josub said financial services generate about R41bn ($2.50bn) in revenue, and offer better margins and higher returns on capital than traditional mobile services because they require significantly less capital investment.
Vodacom has increased its 2030 financial services customer target to 130 million from 120 million previously.
buying diesel in bulk
Addressing energy supply risks and rising fuel costs, Josub and CFO Raisibe Morathi said Vodacom is buying diesel in bulk, increasing storage where possible and arranging for fuel suppliers to hold stocks on its behalf.
He said diesel prices have been capped in South Africa for the next six months to limit cost fluctuations and are considering doing the same in other markets where opportunities arise.
Vodacom's energy costs account for around 4% of its service revenues. The operator uses diesel to power generators for its towers during extended power outages. It also powers them through batteries and solar energy.
Data compiled by LSEG showed Vodacom's earnings before interest, taxes, depreciation and amortization (Ebitda) rose 12.8% to $62.6bn, slightly below the consensus forecast of R63bn.
Group services revenue increased 10.6% to R133.6 billion, supported by strong performances in Egypt, Tanzania, Democratic Republic of the Congo (DRC) and Lesotho.
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