Vodacom Group improved its revenue growth to 6.6 percent in the company's fiscal third quarter ended 31 December, to ZAR 23.6 billion. Service revenue rose 5.7 percent to ZAR 18.9 billion, and Vodacom said it added 2 million customers during the quarter to serve a total of 117 million, including Safaricom.
In its home market South Africa, service revenue rose 4.6 percent to ZAR 13.6 billion, helped by improved data pricing, the company said. The International operations increased service revenue by 9.0 percent to ZAR 5.6 billion, driven by strong growth in mobile money and expanding data services.
Vodacom said South Africa's growth was supported by a successful Summer campaign and improved uptake of data services. Total revenue increased 5.9 percent following 8.7 percent growth in equipment revenue, with device sales positively impacted by an improved sales mix during the quarter, following new device launches.
More contract, data customers in SA
Mobile contract customer revenue increased 4.7 percent to ZAR 5.1 billion, as contract customers rose 7.8 percent to 6.1 million. The decline in contract ARPU of 3.6 percent was affected by the reduction in out-of-bundle revenue. This was supported by a 20.3 percent increase in contract data bundles sold.
Contract customer net additions totaled 35,000 during the quarter, after a tightening of credit criteria given the tough trading environment. Mobile prepaid net additions were strong at 450,000, reflecting the success of Summer campaign and pricing transformation efforts. The decline in prepaid customer revenue slowed to 1.8 percent, and prepaid ARPU was also down 1.8 percent, impacted by the reduction in out-of-bundle rates from the beginning of the year and the subdued economic environment.
Data customers increased 12.5 percent to 22.9 million in South Africa, and overall data usage was up 63.2 percent. Data bundles sold increased 20 percent to 251 million, raising unique bundle data users to 14 million, an increase of 17.8 percent. Active 4G devices on our network increased 36.1 percent to 12.2 million, while the average usage on smart devices rose 59.8 percent to 1.7GB, offsetting the effects of lower out-of-bundle rates.
At the international operators, Vodacom said strong growth in the DRC and Mozambique more than offset the negative impacts from slow progress in pricing improvements, due to intensified competition in Tanzania. The international business added 1.7 million customers in the quarter, taking the base up 8.8 percent in the year to 38.2 million customers.
The international business also gained 915,000 data customers during the quarter, as the operator accelerated the roll-out of 4G networks and increased access to affordable devices. Vodacom invested ZAR 845 million in international capex, which included rolling out 4G services, improving capacity and widening network reach and quality.
M-Pesa revenue up 25%
M-Pesa revenue increased 24.7 percent to ZAR 1.1 billion, increasing its contribution to international service revenue to 18.9 percent from 16.5 percent a year ago. Vodacom added 550,000 M-Pesa customers in the quarter, reaching 14.8 million, resulting in 37.4 percent of customers using the financial services proposition. The firm processed USD 3.4 billion in value of M-Pesa transactions a month during this quarter. Growth was supported by higher transactions per customer.
