Vodacom Group revenue increased by 5.6 percent to ZAR 22.73 billion in the first quarter to 30 June. The mobile operator said it saw strong growth in South Africa as customer demand rose during the lockdown, but international operations were hit by lower economic activity because of Covid-19. Service revenue climbed 7.6 percent to ZAR 18.76 billion. The temporary spectrum assignment in South Africa allowed Vodacom to fast-track the launch of the country's first mobile 5G network and a fixed 5G commercial service.
International service revenue grew by 10.7 percent, benefiting from the rand devaluation. Underlying performance was subdued with a 5.3 percent decline, as a result of lower economic trading activity, free M-Pesa services and customer registration requirements in these businesses.
Normalised international service revenue shrank by 5.3 percent as coronavirus reduced economic activity, with lower pricing for M-Pesa transactions in some operations to enable social distancing, and the barring of service to 2.9 million customers in Tanzania in Q4 of the prior year. Customers increased 7.1 percent compared with the prior year to 37.7 million, with a net loss in the quarter of 919,000, primarily in Tanzania. Vodacom deleted a number of customers in this quarter who had been inactive since barring services in Q4, in line with its 90-day churn policy.
While underlying growth in international voice revenue was down 11.7 percent during the first quarter, data customers increased 5.2 percent to 20.0 million, with data traffic rising 44.3 percent driven, by the need to work from home, and substitution of data over voice during lockdowns in the DRC, Mozambique and Lesotho. Usage per customer increased on average by 32.5 percent.
International M-Pesa revenue was up 17.0 percent and customers increased 3.5 percent to 14.7 million. Revenue was hit by discounted and free person-to-person (P2P) services in most markets. Movement restrictions in several of markets have also seen trade reduced, which resulted in the value and number of transactions decreasing in the quarter.
