South African fixed line operator has Telkom said operating revenue in the six months to 30 September increased by 0.3 percent from a year earlier to ZAR 16.192 billion thanks to higher mobile data and business IT service revenue, partially offset by lower fixed-line voice revenue. Fixed-line voice and inter-connection revenue decreased 4.7 percent to ZAR 8.7 billion, fixed-line data revenue increased 1.2 percent to ZAR 1.2 billion.The number of ADSL subscribers increased 6.7 percent to 898,203 and calling plan subscribers increased 2.0 percent to 860,161. The number of managed data network sites increased 12.8 percent to 45,441.
Mobile revenue increased 55.4 percent to ZAR 926 million. Mobile data revenue increased 50.0 percent to ZAR 303 million thanks to a rise in the number of data subscribers and data deals and promotions launched during the period. However, Telkom is continuing to explore all avenues to de-risk the mobile business. The mobile segment saw a rise in negative EBITDA to ZAR 773 million from ZAR 716 million a year earlier. The number of active mobile subscribers increased 6.9 percent to 1,598,173 with a blended ARPU of ZAR 58.81. Mobile sites integrated increased 28.3 percent to 2,238, with 871 LTE sites integrated.
Group EBITDA decreased 0.4 percent to ZAR 3.933 billion. Headline earnings per share rose to ZAR 0.2242 from ZAR 0.1011 a year earlier.
Operating expenses decreased by 18.1 percent to ZAR 10.323 billion, primarily due to higher fair value gains as a result of the weakening rand and lower payments to mobile operators relating to the decrease in mobile termination rates. Excluding the curtailment gain of ZAR 2.17 billion recognised on the post-retirement medical aid liability and the provision for the Competition Commission fine of ZAR 389 million in the prior period, opex increased 2.4 percent to ZAR 12.49 billion. The group generated free cash flow of ZAR 33 million, a 97.8 percent decrease from the previous period.
