Vodacom Tanzania has recorded a strong financial performance during Q2 this year with the company’s total revenue growing by 18.0% to 290bn/- , with service revenue increasing by 18.3% to 85.1bn/- according to the Quarterly report for the period ended 30 June 2023.
This double digit growth was primarily a result of strong performance in mobile data and M-Pesa revenue, underpinned by our commercial execution and consistent investment in our network.
According to the Vodacom Tanzania Managing Director Philip Besiimire, the company’s customer value management (CVM) platform continued to provide customers with differentiated and segmented multi-product offers, building on our system of advantage, increasing customers’ active days and improving customer experience through personalisation.
“This resulted in a pleasing 7.4% growth in average revenue per user (ARPU), which together with 11.0% growth in customers delivered a solid revenue growth,” he said.
The company’s direct expenses of 93.7bn/- was up 15.0%, in line with the revenue growth.
“We spent 113.3bn/- inoperating expenses, an increase of 21.0%. Excluding an impact of foreign exchange losses, operating expenses increased 16.1%, largely as a result of higher energy costs, investment in network expansion including new technologies like 5G, contractual price escalations, and inflationary adjustments,” Besiimire said.
The Dar es Salaam Stock Exchange (DSE) cost increases were partly offset by savings realised from our cost containment initiatives. Depreciation and amortisation increased 3.9%, reflecting additional investment made in our network.
From a profitability perspective, the company generated 17.7bn/- in operating profit being a significant 117.8% increase, supported by strong top line performance and cost efficiencies.
“We reported 7.0bn/- loss after tax, a 25.3% improvement compared to a loss of 9.4bn/- in the corresponding quarter of the prior year. Excluding the impact of foreign exchange losses of 9.9bn/- , the underlying performance would be a net profit after tax of 2.9bn/-“he added.
Foreign exchange losses were a result of local currency depreciation driven by varying global economic fundamentals, reflecting economic policies’ changes in the major economies.
“Looking forward, I am confident that our excellent run in strategy execution will continue to deliver strongfinancial performance. Our purpose is to connect Tanzanians towards a better future, which we drive through broadening digital inclusion, access to connectivity services and widening M-Pesa’s adoption to support financial inclusion,” he said.
He added, “It remains critical for us to continue investing in our network – particularly our data network, and to expand the accessibility of data services to both mobile and fixed by developing relevant offers to suit our diverse customers’ interests”