Vodacom’s SA customer base falls almost double digits in its first quarter

Mobile phone operator Vodacom said a sharp drop-off in prepaid customers in South Africa resulted in an almost double-digit decline in its local customer base in its first quarter to end-June, when data use surged due to price reductions and Covid-19.

The number of South African customers fell 9.9% to 39.4-million, largely due to fewer prepaid connections in “the period of restricted movement”, the group said in an update.

Group revenue grew 5.6% to R22.7bn year on year, though this is on a reported basis and includes the effects of currency movements. Excluding the effects of currency movements and mergers & acquisitions, group revenue rose 1.3%, Vodacom said.

Strong demand for voice, data and financial services contributed to the 6.4% increase in service revenue growth in South Africa during the period on a reported basis, while the group’s international portfolio benefited significantly from currency changes to grow service revenue by 10.7%.

“In the face of an unprecedented global pandemic, Vodacom Group has responded rapidly to assist governments where it operates in curbing the spread of Covid-19 while also adapting to significant changes in customer demands and behaviour patterns,” said CEO Shameel Joosub.

“In SA, the combination of increased demand for data following significant tariff reductions of up to 40% effected on April 1 and more people working and being educated remotely resulted in a significant increase in mobile and fixed traffic in the first quarter,” Vodacom said.