Vodacom Revenue Slides on Cuts to South African Mobile Fees
Vodacom Group Ltd., the mobile operator with the most subscribers in South Africa, said third-quarter revenue fell after the country’s regulator halved the fees it can charge rivals for using its network. The stock fell the most in more than 10 weeks.
Sales decreased 1.1 percent to 20 billion rand ($1.8 billion) in the three months through December, the Johannesburg-based company said in a statement on Wednesday. Active subscriber numbers rose 9 percent to 61.1 million.
“There was a significant impact from the 50 percent decline in mobile termination rates in South Africa, increased competition and we’re seeing increased pressure on consumer spending,” Chief Executive Officer Shameel Joosub said in the statement.
Vodacom is seeking to boost Internet services and expand in Africa through acquisitions as voice revenue drops in its home South African market. The company, which is 65 percent owned by Newbury, England-based Vodafone Group Plc, agreed to buy Internet provider Neotel Pty Ltd. for 7 billion rand last year and is said to be in talks to buy Tanzanian phone company Zantel, people with knowledge of the matter said last month.
Vodacom shares declined as much as 3.8 percent, the steepest intraday decline since Nov. 24, and was down 3 percent to 130.10 rand as of 9:32 a.m. in Johannesburg.
Service revenue fell 2.7 percent to 15.8 billion rand, according to the statement. Data sales increased 20 percent to 4.3 billion rand.
Source: Bloomberg 4 February 2015