Vodacom is betting its growth over the next five years on its ability to grow customers by about a quarter.
The group aims to add about 49-millon customers to reach 260-million by 2030. Vodacom first disclosed its ambitions in February, outlining its strategy for the next five years, dubbed Vision 2030.
This week, group CEO Shameel Joosub gave more detail about the plan as the Vodafone subsidiary reported full-year earnings to March 2025.
Over a five-year period from financial year 2020 to 2025, “we significantly expanded geographic and product diversification resulting in the number of customers using our networks,” Joosub said, highlighting an increase in customers from 115.5-million to 211.3-million.
During the same period, financial services customers rose from 53.2-million to 87.7-million, including Safaricom.
The group’s customer acquisition strategy was boosted by the acquisition of Vodafone Egypt in December 2022 for R42bn to access the market leader in the country, with market share of more than 40% at the time. That unit now accounts for 48.3-million, the largest single market by customers, a title that had traditionally been held by home country, SA.
The aim under Vision 2030 includes growing the customer base to 260-million and financial services customers to 120-million.
“We have to be growing our customers,” Joosub told Business Day in an interview.
“Customer growth informs revenue growth. Second is the usage growth. In telco, it’s about increasing the amount of data traffic and monetising it. In fintech, it’s about increasing the frequency of transactions but also looking at increasing the number of use cases that lead customers to spend more through the platform, and how much of the money can stay in the ecosystem.”
Vodacom’s growth thesis is supported by the fact that Africa’s youth population is projected to grow by 51% from 630-million to 940-million by 2030. Additionally, the group sees room to expand its financial services offering, as the World Economic Forum estimates that 52% of Africa’s population is now unbanked.
SA’s largest mobile operator has upgraded its medium-term guidance, expecting to grow service revenue and earnings by at least 10% between 2025 and 2030, driven by its international business.
“While cementing our leadership in all forms of connectivity, we expect our group service revenue contribution from beyond mobile to increase to 30% from 21% today.”
This comes as reported revenue for the year to end-March was 10.9% higher on a normalised basis at R152.2bn, while service revenue grew 11.2% to R120.7bn.
Headline earnings per share (HEPS) were 1.3% higher at 857c. A final dividend of 335c per share was declared, taking the total dividend to 620c, up 5.1% year on year.
Group service revenue grew 11.2% on a normalised basis, “highlighting the resilience of our diversified portfolio and our strong commercial execution”, with 8.2-million customers being added to the base, a 4% increase.
Normalised growth presents performance on a comparable basis and adjusts for trading foreign exchange, foreign currency fluctuation and hyperinflation accounting, and excludes the effect of merger, acquisition and disposal activities.
The SA business reported service revenue growth of 2.3%, led by a recovery in the prepaid segment, sustained data traffic growth of more than 36.4%, and the increasing contribution of its beyond mobile services. Those services contributed R11.2bn, or 17.8% of SA’s service revenue.
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