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VOD - Vodacom trading update for the quarter ended 30 June 2009
Vodacom Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1993/005461/06)
Share Code: VOD & ISIN: ZAE000132577
("Vodacom Group" or "Vodacom")
Vodacom trading update for the quarter ended 30 June 2009
Group mobile customers increased 19.5% from the prior year quarter to 41.3
million at 30 June 2009. The South African mobile operations contributed 69.6%
(31 March 2009: 69.7%) of Group total mobile customers and the international
mobile operations 30.4% (31 March 2009: 30.3%) at 30 June 2009.
Vodacom Group revenue for the three months ended 30 June 2009 rose 12.2% to
R14.2 billion compared to the same quarter last year. The increase was as a
result of organic revenue growth of 5.9% and Gateway contributing approximately
R800 million in the quarter.
South Africa
South African revenue was up 8.2% year on year notwithstanding weaker economic
conditions, largely as a result of the growth in customers and data revenue.
The weaker conditions particularly impacted contract revenue as customers
managed their bundles more effectively. The quarter`s results were also
impacted by the additional public holidays in April 2009 compared to the prior
year quarter.
The South African operations continued to achieve strong customer growth,
adding 1.1 million customers in the quarter to 28.7 million, 15.4% higher than
the prior year and 4.0% higher than at 31 March 2009. Customers on the
dynamically priced prepaid product, Yebo4Less, increased from 4.8 million at 31
March 2009 to 7.2 million at 30 June 2009, representing 29.3% of the prepaid
customer base. Market share was maintained at 53%.
Targeted loyalty programmes were effective in reducing overall churn by 2.4
percentage points to 34.1% at 30 June 2009 and prepaid churn to 38.4% from
40.9% reported for the quarter to 31 March 2009. The 11.4% growth in mobile
traffic in the quarter to 6.9 billion minutes from 6.2 billion minutes in the
previous quarter indicated the success of focused promotional offers.
Blended ARPU declined 4.7% from the previous quarter as a result of higher
penetration in lower income market segments, lower revenue in April 2009 and
weaker economic conditions. Prepaid ARPUs remained relatively stable at R64 per
month compared to R65 per month in the quarter to 31 March 2009. Contract
customer ARPU was 3.5% lower than in the previous quarter to 31 March 2009, as
customers limited spending outside their bundles.
International
Revenue in the international mobile operations declined 8.1% compared to the
same quarter last year. Revenue in Tanzania and the Democratic Republic of
Congo ("DRC") continued to be affected by weak economic conditions, strong
competition and higher excise duties. Excluding the excise duties, revenue from
the international operations was down 4.2%. W e have taken action to reduce
expenditure in Tanzania and the DRC to offset lower than expected revenues.
Mozambique and Lesotho delivered strong revenue growth in the quarter.
The international operations recorded strong customer growth, up 30.0% to 12.6
million on the same quarter last year and up 4.9% from 12.0 million at 31 March
2009.
Churn increased in the Tanzanian and DRC operations due to low tariff offers
from competitors. Vodacom Mozambique continued to gain market share and churn
reduced by 10.8 percentage points from the previous quarter. Churn is expected
to increase in Mozambique in the next quarter following the seasonally higher
connections in December 2008.
In Tanzania, ARPU was 3.8% lower in Tanzanian shillings compared to the
previous quarter. ARPU in the DRC was 11.5% lower in US dollars for the quarter
due to shrinking disposable income, a reduction in tariffs and lower
interconnection revenue. During the quarter the rand appreciated 3.8% and 10.1%
against the US dollar and Tanzanian shilling respectively, resulting in lower
reported ARPU in rand.
Pieter Uys, CEO of Vodacom Group, commented:
"We delivered on our strategy to offer greater value to customers, drive the
penetration of mobile broadband and compete successfully in the enterprise
market.
"We continued to grow our customer base in our South African and international
operations, by 15.4% and 30.0% respectively compared to the same quarter last
year. Consumer spending remained under pressure, which we countered with
focused promotions in all our markets to offer more value to Vodacom customers.
"In South Africa, we added 98 000 mobile broadband customers and a further 18
000 telemetry broadband packages in the quarter, growing our total data
connectivity customers from 892 000 to just over a million. Vodacom Business
continued to gain traction, signing contracts with a number of corporate
customers to supply connectivity, hosting and related services.
"We expect customer growth to slow in the remaining quarters as customer
registration is now required in our three largest markets. We remain focused on
maintaining our market share, stimulating usage and containing our costs."
The quarterly trading statement has not been audited or reviewed by Vodacom`s
external auditors.
Trading Statement
Key performance indicators for the quarter ending
South Africa
30 June 31 March 30 June
2009 2009 2008
Customers (thousands)1 28 735 27 625 24 891
Prepaid 24 578 23 561 21 138
Contract 4 039 3 946 3 643
Community services 118 118 110
Churn (%) 2 34.1 36.5 40.6
Prepaid 38.4 40.9 46.0
Contract 9.2 10.5 9.6
Traffic (million of minutes) 3 6 896 6 189 5 796
Outgoing 4 966 4 225 3 908
Incoming 1 930 1 964 1 888
ARPU (Rand per month) 4 123 129 130
Prepaid 64 65 64
Contract 444 460 481
Community services 427 471 597
Quarterly Year on year
% change % change
Customers (thousands)1 4.0 15.4
Prepaid 4.3 16.3
Contract 2.4 10.9
Community services - 7.3
Churn (%) 2 2.4 pts 6.5 pts
Prepaid 2.5 pts 7.6 pts
Contract 1.3 pts 0.4 pts
Traffic (million of minutes) 3 11.4 19.0
Outgoing 17.5 27.1
Incoming (1.7) 2.2
ARPU (Rand per month) 4 (4.7) (5.4)
Prepaid (1.5) -
Contract (3.5) (7.7)
Community services (9.3) (28.5)
International
30 June 31 March 30 June
2009 2009 2008
Customers (thousands)5 12 571 11 989 9 672
Tanzania 5 917 5 667 4 495
DRC 4 182 4 170 3 454
Mozambique 1 925 1 634 1 302
Lesotho 547 518 421
Churn (%) 2
Tanzania 47.9 43.3 45.0
DRC 59.8 48.8 55.8
Mozambique 48.3 59.1 64.1
Lesotho 20.0 18.2 18.5
ARPU (Rand per month) 4
Tanzania 6 35 43 48
DRC 39 53 64
Mozambique 36 44 36
Lesotho 65 67 68
ARPU (local currency per month) 4
Tanzania (Tanzanian shilling) 6 5 511 5 729 7 432
DRC (US dollars) 4.6 5.2 8.2
Mozambique (metical) 114 117 112
Quarterly Year on year
% change % change
Customers (thousands)5 4.9 30.0
Tanzania 4.4 31.6
DRC 0.3 21.1
Mozambique 17.8 47.8
Lesotho 5.6 29.9
Churn (%) 2
Tanzania (4.6 pts) (2.9 pts)
DRC (11.0 pts) (4.0 pts)
Mozambique 10.8 pts 15.8 pts
Lesotho (1.8 pts) (1.5 pts)
ARPU (Rand per month) 4
Tanzania 6 (18.6) (27.1)
DRC (26.4) (39.1)
Mozambique (18.2) -
Lesotho
(3.0) (4.4)
ARPU (local currency per month) 4
Tanzania (Tanzanian shilling) 6 (3.8) (25.8)
DRC (US dollars) (11.5) (43.9)
Mozambique (metical) (2.6) 1.8
Notes:
1. South African customer totals are based on the total number of customers
registered on Vodacom`s network, which have not been disconnected, including
inactive customers, at the end of the period indicated. Three-month inactive
customers were 8.9% (March 2009: 8.9%, June 2008: 11.0%) of total customers,
9.8% (March 2009: 9.9%, June 2008: 12.3%) of prepaid customers and 3.7%
(March 2009: 3.4%, June 2008: 3.7%) of contract customers at 30 June 2009.
2. Churn is calculated by dividing the annualised number of disconnections
during the period by the average monthly total reported customer base during
the period.
3. Traffic comprises total traffic registered on the Vodacom SA network,
including bundled minutes, outgoing international roaming calls and calls to
free services but excluding national roaming and incoming international
roaming.
4. ARPU is calculated by dividing the average monthly revenue (recurring
mobile) by the average monthly total reported customer base during the
period. ARPU excludes revenue from equipment sales and other sales and
services.
5. International customer totals are based on the total number of customers
registered on Vodacom`s network, which have not been disconnected, including
inactive customers, as at the end of the period indicated. Three-month
inactive customers were 18.4% (March 2009: 20.3%, June 2008: 19.0%) for
Tanzania, 33.6% (March 2009: 33.1%, June 2008: 22.7%) for the DRC, and 31.0%
(March 2009: 28.5%, June 2008: 38.0%) for Mozambique and 15.9% (March 2009:
13.4%, June 2008: 13.5%) for Lesotho as at 30 June 2009.
6. ARPU has been re-stated for the June 2008 quarter.
Excise duty is now netted off against revenue in line with group accounting
policies (previously disclosed R50 (TZS 7 829)).
Exchange rates
30 June 30 June Year on year
2009 2008 % change
Closing
USD/ZAR 7.82 7.88 0.8
ZAR/Mtn 3.45 3.03 13.9
ZAR/TZS 168.07 150.37 11.8
EUR/ZAR 11.04 12.45 11.3
Quarter average
USD/ZAR 8.50 7.78 (9.3)
ZAR/Mtn 3.20 3.11 3.1
ZAR/TZS 157.06 155.55 1.0
EUR/ZAR 11.57 12.15 4.8
Forward looking statement disclaimer
This quarterly statement contains statements about Vodacom that are or may be
forward looking statements. All statements, other than statements of historical
facts included in this statement may be forward looking statements. Any
statements preceded or followed by, or that include the words "forecasts",
"believes", "expects", "intends", "plans", "prediction", "will", "may",
"should", "could", "anticipates", "estimates", "seeks", "continues", or similar
expression or the negative thereof, are forward looking statements.
By their nature, forward looking statements are inherently predictive,
speculative and, because they relate to events and depend on circumstances that
will occur in the future, involve known and unknown risks, uncertainties and
other facts or factors which may cause the actual results, performance or
achievements of the Group or its industry, to be materially different from any
results, performance or achievements expressed or implied by such forward
looking statements. These forward looking statements are not guarantees of
future performance and are based on numerous assumptions regarding Vodacom
Group`s present and future business strategies and the environments in which it
will operate in the future. All subsequent oral or written forward looking
statements are attributable to the Group or any member thereof or any persons
acting on their behalf are expressly qualified in their entirety by the
cautionary statements above and below. Vodacom expressly disclaims any
obligations or undertaking to disseminate any updates or revisions to any
forward looking statements contained herein or to reflect any change in their
expectations with regard thereto or any change in events, conditions or
circumstances on which any such forward looking statement is based.
Midrand
22 July 2009
Sponsor: UBS South Africa (Pty) Ltd
Date: 22/07/2009 17:01:14 Supplied by www.sharenet.co.za
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