Vodacom Group reports 5.2 pct growth in revenue, even as Tanzania weighs

Vodacom, SA’s largest mobile operator, says its new focus on financial services paid off, with almost double-digit revenue growth from this business line in its first quarter to June, despite it taking a significant hit from new mobile money levies in Tanzania.

Group revenue rose 5.2% in reported terms to R26.1bn to end-June, Vodacom said on Thursday, with financial services revenue up 9.3% year on year to R2.05bn, the latter still driven largely by its mobile money platform, M-Pesa.

According to a financial statement seen by The Business Wiz, the company’s financial service revenue was up 9.3% in Vodacom’s first quarter to end-June, and would have grown by almost a fifth without Tanzanian levies.

The company said financial services remains a clear strategic priority for the Group and the business continues to gain momentum, contributing R2.1 billion to service revenue.

“The segment is driven in the main by our pioneering mobile money platform M-Pesa, which is Africa’s largest by transaction value. Combined with Safaricom, our M-Pesa platform processed US$340 billion over the last twelve months, up 20.2%. Looking ahead, a further meaningful 43% reduction to mobile money levies in Tanzania from July 2022 bodes well for M-Pesa’s contribution to financial inclusion in the country,” part of the statement read.

Commenting on the company’s performance for the period ending June30, 2022, Shameel Joosub, Vodacom Group CEO said Vodacom Group produced a resilient first quarter performance despite the turmoil in financial markets and uncertainty about the recovery of the global economy, as a result of COVID-19 and the Russia-Ukraine conflict.

“Inflation continues to accelerate in most of the markets where we operate, which means that the cost of living has climbed. As a purpose-led organisation, Vodacom is accelerating the delivery of innovative products to provide even greater value to customers under increasing financial strain,” Joosub said.