Telkom profits soar with 50% boost

Telkom’s profit and earnings for the first half of the 2024 financial year grew by over 50%, as the company benefitted from lower depreciation charges and growth in EBITDA.

The telecoms giant released its results for the six months through September 2023 today, which revealed an improved performance for the company.

Telkom’s revenue grew by 2.5% to R21.78 billion, driven by growth in mobile traffic, the monetisation of the rollout of its fibre infrastructure and growth of the IT business. 

The company said its cost-reduction initiatives also bore fruit but were partially offset by inflationary increases and resulted in operating expenses increasing by below inflation at 2.4%. 

However, despite this increase, EBITDA grew by 1.7% to R5.03 billion but was limited by higher bad debt provisions.

Headline earnings per share grew by 46.7%, and basic earnings per share increased by 52.1%.

Telkom said its profit for the period was boosted by lower depreciation charges and growth in EBITDA, while higher interest rates materially increased net finance costs compared to 2022.

The company’s operating profit grew by 58.2% to R2.21 billion, while profit for the period grew 52.3% to R976 million.

Telkom’s subscriber base now stands at 18.3 million with a blended average revenue per user (ARPU) of R85. 

Its pre-paid customer base expanded by 1.0% to reach 15.3 million with an ARPU of R64, while the post-paid segment grew by 3.6%, reaching 3 million with an ARPU of R182. 

The company’s Telkom Consumer segment was the largest contributor to revenue from external customers (R12.88 billion) and revenue from contracts with customers recognised over time (R11.13 billion).

BCX was also a significant contributor, followed by Openserve and Gyro.

Telkom did not declare an interim dividend.