JOHANNESBURG – South African mobile phone operator Vodacom reported a 2.7 percent increase in full-year earnings on Monday, buoyed by growth in data revenue.
The South African unit of Britain’s Vodafone has spent billions to expand its network in recent years with a strong focus on providing faster internet to its customers as more of them get smartphones.
“The acceleration in network investment over the past two years is true success story of effective capital investment to ensure growth in revenue and customers,” Vodacom’s CEO Shameel Joosub said in a statement released with the results.
“The demand for data continues to be our key driver.”
The mobile operator said headline earnings per share – the main profit measure in South Africa that strips out certain one-off items – came in at 883 cents in the year to the end of March, from 860 cents a year earlier.
Data revenue was up 27.7 percent as Vodacom increased LTE/4G coverage in its home market, the company said.
Vodacom spent 8.7 billion rand ($561 million) to upgrade its network infrastructure which included more than doubling its LTE/4G sites to more than 6,000, the company said in a statement.
“This enabled us to increase LTE/4G coverage across South Africa to 58 percent from 35 percent to satisfy exceptional growth in demand for data,” said Joosub.
South Africa is in the midst of switching its television signal to digital from analogue, a move that would free up much-needed airwaves as consumers increasingly use smartphones to browse the internet and download applications.
The company with operations across five African countries said its sees group capital expenditure of 12-14 percent of group revenue over the next three years.