South Africa’s Vodacom has reported a rise in revenues and earnings over the first six months of the year on the back of growth at its international operations and improved trends in its domestic market.
Majority owned by the UK’s Vodafone (Newbury), the operator said revenues were up by 6.6%, to ZAR36.7 billion ($3.55 billion), compared with the same period in 2012, while earnings before interest, taxation, depreciation and amortization rose by 9.6%, to ZAR13.2 billion, over the same period.
The operator also said its customer base grew by 9.7% between June 2012 and June 2013, to 53.8 million subscribers overall, driven by the acquisition of another 949,000 customers in South Africa and some 2.3 million in other markets.
The operator also flagged success at its data business, with revenues generated from the sale of data services up 29% compared with the first half of 2012.
Even so, free cash flow dropped by 7.4%, to ZAR3.2 billion as Vodacom continued to invest in bolstering network capacity to cope with an 80% increase in the usage of data services.
Capital expenditure over the six-month period amounted to approximately ZAR4.9 billion.
“A cornerstone of our strategy is sustained investment in network capacity,” said Shameel Joosub, Vodacom’s chief executive. “With increased capacity, we’re able to offer better value and support higher usage without impacting quality.”
Some ZAR3.1 billion of the capital expenditure was spent in South Africa, where Vodacom was able to increase its 3G coverage to 88.9% of the population in the first half of 2013.
Noting the sharp increase in data usage, Joosub said the company planned to accelerate network investments and is currently in the process of “determining the investment allocation per country”.