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Telkom has reported a big increase of R1.9 billion in full-year profits, an increase of more than 100%. The company announced its financial results for the year ending March 31, 2024, attributing the gains to the group’s ‘data-driven strategy’.

In the results, Telkom recorded a 1.6% increase in group revenues to R43.2 billion, while mobile services revenues rose 6.8% to R19 billion, mainly driven by demand for mobile data and fiber services.

Telkom is South Africa’s third largest telecommunications company and says its short- to medium-term priorities of strengthening its balance sheet by paying down debt and investing in capital expenditure to boost growth have delivered the expected results. It posted full-year profits of R1.9 billion, posting gains in the financial year ending March 31, 2024, despite the country’s challenging economy.

“We have promised that data consumption will drive our growth. We have made that happen. We have committed to prioritizing cash storytelling. I think we have succeeded. We focus on operational rationalization. We committed to prioritizing Carfax and we will continue to do so. We talked about strength and energy. We have made that happen. I think both the sector and micro challenges are many, but as an organization we think we are ready,” said Serame Taukobong, CEO of Telkom.

The group says its data-driven strategy resulted in mobile services revenue growing by 6.8% to R19 billion, with the company also exceeding 20 million mobile subscribers.

Openserve’s fiber connectivity rate also increased by 48.5%, surpassing 1.2 million fiber households.

“What is critical for us is that the long-term investments that Telkom has made, and especially the positioning of ourselves and the beginnings of that, are starting to yield results as we have invested in the future and prepared for the high demand to data and the data growth we expect. anticipation and it starts to yield results. We have not recently started investing in fiber, but have been investing for over 30 years and if you start early, this is strategically important and we can now focus on the Carfax rollout,” explains Taukobong.

Telkom says it will be able to pay dividends in the near term as it targets fiscal 2024 and proposes a dividend payout range of 30-40% of free cash flow.

“The board had taken the decision to suspend dividends 3 to 4 years ago as the organization was going through turbulent times. During the recent meeting, the board decided to reconsider the dividend position and reformulate the dividend policy. We will not pay a dividend for the 2024 financial year. However, we believe that in 2025, as we move through the current fiscal year, we may reconsider based on performance. We will largely look at cash flow to ensure the company’s performance is strong enough,” said Telkom CFO Nonkululeko Dlamini.

Telkom’s all share price rose 5.4% following the results release, with the company looking to maintain a strong asset base and balance sheet for the 2025 financial year.

Video: Telkom reports big increase in annual profit: Serame Taukobong