Telkom SA SOC Limited, a leader in South Africa's digital infrastructure, announced financial results for the six months ended September 30, 2024.
The results demonstrate steady underlying operational performance, delivering sustainable financial returns while positioning the company as the backbone of South Africa's digital future.
The results reflect Telkom's successful execution of its data-led strategy, with group revenue growing by 1.9% to R21.4 billion, driven primarily by exceptional performance in data services. Mobile data revenue increased by 12.7% and fiber data service revenue rose by 15.5%.
The company's adjusted EBITDA, excluding restructuring cost of R160 million and the Telkom Retirement Fund derecognition loss of R618 million, increased by 18.3% to R5.6 billion, with the adjusted EBITDA margin improving to 26.2%, 3.6 percentage points up on the prior period.
The half-year performance has seen a significant strengthening in the balance sheet. Free cash flow turned positive at R768 million, compared to negative R478 million in the previous period. Interest-bearing debt decreased by R885 million and the net debt to adjusted EBITDA ratio improved to 1.3x from 1.8x at year end.
This half-year improvement reflects the company's enhanced operational efficiency and successful monetization of its digital infrastructure asset base.
“Our continued investment in our extensive fiber network and mobile infrastructure is now delivering the competitive advantage we anticipated, propelling our data-led strategy to ensure future-readiness,” said Serame Taukobong, Group Chief Executive Officer.
The company's infrastructure investments continue to deliver significant operational results. Mobile subscribers grew by 24.6% year-on-year, surpassing 22.7 million, while mobile data subscribers increased by 19.6% to 14.6 million, driving a 12.7% rise in data revenues. Openserve’s fiber infrastructure also showed strong performance, with homes passed and connected growing by 11.4% and 18.1%, respectively, maintaining a market-leading home connection rate of 49.7%. Additionally, IT revenues sustained steady growth, highlighting the effectiveness of the company's connect-led strategy.
“Our improved cash generation and a strengthened balance sheet position us well to continue investing for future growth while maintaining financial discipline,” said Nonkululeko Dlamini, Group Chief Financial Officer.
“We continued with a smart capital spend of R2.5bn invested in infrastructure, which is at the heart of our strategy. The capital intensity ratio of 11.9% remains efficient and in line with our forecast of 12-15%,” Dlamini added.
These investments and results enhance Telkom as the enabler of South Africa’s digital economy, attracting recognition such as being named “Best Mobile Provider in South Africa” by the 2024/25 Ask Afrika Orange Index.
Telkom continues to optimize its asset portfolio, making progress in the disposal of non-core assets while focusing on high-growth areas.
The Competition Tribunal approved the disposal of Swiftnet on September 3, 2024, marking another significant milestone. We still await regulatory approval for the license transfer.
Telkom aims to maintain the good momentum into the second half of the year, driving sustained growth.
