Vodacom blames poor growth on less load-shedding 

Vodacom reported marginal revenue growth in South Africa for the third quarter of its 2024 financial year, which it partly attributed to a slowdown in data traffic growth due to reduced load-shedding.

While group revenue grew by over 29%, Vodacom’s South African revenue only grew by 4% to R22.8 billion in the quarter ended 31 December 2023. 

Service revenue grew 1.9% to R15.7 billion, reflecting a strong comparative period for consumer mobile. 

Growth in the quarter was supported by new services and a successful summer campaign.

New services such as financial and digital services, fixed and Internet of Things were up 10% and contributed R2.6 billion, equivalent to 16.3% of South Africa’s service revenue. 

“We expect service revenue growth in the fourth quarter to be stronger than the third quarter result supported by an increase in improved performance in Vodacom Business,” the company said.

Mobile contract customer revenue increased 2.5% to R5.9 billion, supported by a price-up in the first quarter. 

Mobile contract average revenue per user was flat at R299 as Vodacom lapped a strong comparative period in the consumer contract segment. 

In the prior year’s quarter, Vodacom’s best network availability supported above-trend data traffic growth during a period of heightened load-shedding. 

However, load-shed hours in the third quarter were around 40% lower year-on-year, impacting data traffic growth. 

For the entire group, Vodacom reported service revenue growth of 29.7% to R31.1 billion, positively impacted by the acquisition of Vodafone Egypt in December 2022. 

Excluding the contribution of Egypt, group service revenue growth was 4.5% or 3.2% on a normalised basis, supported by an improved performance in its international business.

“Looking ahead, we are fully alert to the financial constraints on customers caused by the high cost of living and remain committed to delivering innovations that enhance the value we deliver to customers to help alleviate the cost of living pressures,” said CEO Shameel Joosub. 

“We are also mindful of an evolving macro-economic environment across our footprint, including foreign exchange rate risk, and expect that our business model will continue to demonstrate its resilience.”