VODACOM’S interim results on Monday are expected to be favourable after the cellphone giant announced yesterday it had enjoyed double-digit growth in revenue in the six months to September.<\/p>\n
The 14 percent increase in revenue to R26-billion was despite a saturated South African market and stiff competition in its limited operations. The company operates in only four countries outside South Africa.<\/p>\n
Pieter Uys, Vodacom’s chief executive, said: “These provisional results demonstrate once again strong growth in Vodacom’s business. We now have almost 36 million customers, which is a 13.1 percent increase on a year ago.”<\/p>\n
Operating profit increased by 12.5 percent to R6.4-billion compared with the previous corresponding period.<\/p>\n
Analysts are optimistic that the company is weathering the financial crisis well.<\/p>\n
Dopek Pater, Africa Analysis partner, said: “It’s a healthy set of results considering that they incurred increased costs in some of their operations.<\/p>\n
“In the DRC, and to a lesser extent Mozambique and Tanzania, their base stations have been suffering power-supply problems, and the company has had to run generators to meet demand,” he said. <\/p>\n
Also yesterday, the company launched a R100-million data centre catering for its business clients in an effort to continue revenue growth without relying purely on subscriber growth.<\/p>\n
The 1000m² facility will allow business clients to store applications and data for back-up purposes rather than relying on their own costly servers, which waste space and large amounts of electricity during down time.<\/p>\n
This has been especially vital for Vodacom, which has been restricted from aggressively expanding into the rest of Africa by an agreement between its shareholders Telkom and Vodafone.<\/p>\n
Spiwe Chireka, Frost & Sullivan ICT analyst, said the convergence strategy was common throughout the industry.<\/p>\n
Chireka said: “There is saturation in the voice market, at least in South Africa. <\/p>\n
“While [the data centre is] mainly for corporate clients, there might be scope for consumers in the future. It’s not a surprise that they’re investing in data.” <\/p>\n
Following the sale of a stake that will give Vodafone control of the company, Vodacom will be able to expand into the rest of the continent and beyond.<\/p>\n
Pater said that despite the agreement with the government to preserve the Vodacom brand, Vodafone’s strategy of unilateral branding would mean Vodacom would slowly be phased out over the years. <\/p>\n
Vodafone currently has 27 operations across the world, including eight in Africa. Four of these are branded under Vodacom.<\/p>\n
Pater said: “They’ll most probably establish new operations across the continent using the Vodafone identity, but also make use of Vodacom’s expertise.<\/p>\n
Chireka agreed: “We have seen Cel-Tel, which was very well known in Africa, acquired by Zain. In only two years all those operations were fully rebranded as Zain.”<\/p>\n
Vodacom is expected to be listed in mid- 2009, following shareholder and competition authority approval.<\/p>\n