According to the telco, the rand appreciated by 20% against a basket of its international currencies, impacting reported growth.
Normalised group service revenue growth was 7.8% as international growth accelerated.
Strong M-Pesa revenue supported normalised growth of 13.5% for the group’s international markets, while on a reported basis, service revenue of R5.3 billion (US$351 million) declined by 6.3% as a result of currency translation.
In May 2021, he says, a consortium led by Safaricom was awarded a mobile telecommunications licence by the Ethiopian government, following a fiercely contested international bidding process.
Separately, Joosub adds that in June 2021, the company announced that more than 70 merchants had joined the VodaPay ecosystem ahead of the launch of its South African super-app in the coming months.
“VodaPay is expected to support greater digital and financial inclusion, which is core to our purpose-led strategy.
“It is testament to the depth and strength of the group’s leadership team that we were able to achieve these milestones and a strong financial performance while remaining resolutely focused on dealing with the devastating impacts of the COVID-19 pandemic across our markets.”
According to the CEO, a combination of greater value and an enhanced customer experience supported sustained demand for connectivity as customers continued to work, entertain and educate from home, and contributed to service revenue growth of 5.2% in South Africa.
“Our international portfolio delivered normalised service revenue growth of 13.5%, marking a meaningful recovery from the prior fiscal year.”
According to Joosub, the firm also implemented a coordinated response to maintain service and prioritised the safety of customers, staff, suppliers and franchise store employees in areas impacted by the unrest.
“The financial impact of damage to our infrastructure related to the unrest was not material,” he said.
“Since the beginning of the quarter, South Africans have benefitted from a further 14% price reduction in the 1GB 30-day data bundle – marking a cumulative 43% cut since April 2020 – and our significant investment in infrastructure and technology of R2.9 billion (US$195.5 million) to support network capacity and resilience.”
The performance was supported by M-Pesa revenue growth, up 43.2% on a normalised basis, which benefited from the increased customer base, higher platform usage and the reinstatement of P2P M-Pesa transaction fees.
“We zero-rated P2P M-Pesa transaction fees for the majority of the FY21 to support our customers and facilitate economic activity. The reported service revenue decline of 6.3% for our international markets reflects the impact of currency translation. In the quarter, the rand posted a sharp recovery, appreciating by 20% against a basket of our international currencies, negatively impacting the reported result.
“Looking forward, while we expect disposable income to remain under pressure, our ‘System of Advantage’ will deliver diversified, differentiated offerings to our customers, further strengthening and growing our relationships with them.
“Also, we eagerly anticipate the outcome of the legal processes underway pertaining to the auction of high-demand spectrum in South Africa and hope that the impasse will be quickly resolved in the best interests of consumers.”