THE Vodacom Group has released interim results that reflect a good performance despite it's local division desperately attempting to stave off competition from rival Cell C.
The group's operating profit increased by 22.8% to R8.9-billion while its operating profit in South Africa increased 12.2% in six months up to September 2012.
"This was due to the growth in earnings before interest, taxes, depreciation and amortisation and lower growth of 3.7% in depreciation and amortisation," said Vodacom group chief executive Shameel Joosub. "The international operations delivered an operating profit of R5.2-billion for the six months ended September 30 compared to the operating loss of R2.6-billion in the prior period, which included an impairment loss attributable to the Gateway companies of R3.1-billion."
Joosub did, however, admit that the past six months have not been easy for local operations.
"The past six months have been characterised by strong competitive pressure. However, through the introduction of targeted promotions and by building on our network advantage we've been able to counter this pressure, drive increased usage and deliver overall revenue growth in line with guidance."
His comment came after Cell C's chief executive Alan Knott-Craig, who was Joosub's boss when he headed up Vodacom, turned up the heat by charging 99 cents a minute to make both local and international calls.
In what has turned into a former master versus former student showdown, Joosub responded last month by slashing international call rates to 89 cents.
Knott-Craig pulled an ace up his sleeves by reducing the international rates to 85 cents.
Joosub said Vodacom saw its tax rate plunge to 30.8% from 37.8%.
"This was mainly due to the replacement of secondary tax on companies in Nigeria with a dividend withholding tax. The tax expense of R2.7-billion for the six months ended September 30 increased by 2.0% compared to prior year.
"The increase is mainly due to increased profitability in South Africa and Tanzania and higher withholding tax in Nigeria," said Joosub.
The group's capital expenditure for the period was R4.7-billion, 36.1% higher than last year.
"Capital investment in SA of R3.2-billion mainly related to increasing our 3G coverage, data network speeds, transmission investment. In our international operations we continue to spend on both capacity and coverage to support the growth in customers and the take up of data services, increasing capital expenditure by 130.4% to R1-billion," he said.
Good results for Vodacom
THE Vodacom Group has released interim results that reflect a good performance despite it's local division desperately attempting to stave off competition from rival Cell C.
The group's operating profit increased by 22.8% to R8.9-billion while its operating profit in South Africa increased 12.2% in six months up to September 2012.
"This was due to the growth in earnings before interest, taxes, depreciation and amortisation and lower growth of 3.7% in depreciation and amortisation," said Vodacom group chief executive Shameel Joosub. "The international operations delivered an operating profit of R5.2-billion for the six months ended September 30 compared to the operating loss of R2.6-billion in the prior period, which included an impairment loss attributable to the Gateway companies of R3.1-billion."
Joosub did, however, admit that the past six months have not been easy for local operations.
"The past six months have been characterised by strong competitive pressure. However, through the introduction of targeted promotions and by building on our network advantage we've been able to counter this pressure, drive increased usage and deliver overall revenue growth in line with guidance."
His comment came after Cell C's chief executive Alan Knott-Craig, who was Joosub's boss when he headed up Vodacom, turned up the heat by charging 99 cents a minute to make both local and international calls.
In what has turned into a former master versus former student showdown, Joosub responded last month by slashing international call rates to 89 cents.
Knott-Craig pulled an ace up his sleeves by reducing the international rates to 85 cents.
Joosub said Vodacom saw its tax rate plunge to 30.8% from 37.8%.
"This was mainly due to the replacement of secondary tax on companies in Nigeria with a dividend withholding tax. The tax expense of R2.7-billion for the six months ended September 30 increased by 2.0% compared to prior year.
"The increase is mainly due to increased profitability in South Africa and Tanzania and higher withholding tax in Nigeria," said Joosub.
The group's capital expenditure for the period was R4.7-billion, 36.1% higher than last year.
"Capital investment in SA of R3.2-billion mainly related to increasing our 3G coverage, data network speeds, transmission investment. In our international operations we continue to spend on both capacity and coverage to support the growth in customers and the take up of data services, increasing capital expenditure by 130.4% to R1-billion," he said.
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