Telkom (TKG) H1 2025 earnings summary

Executive summary

• Data-led strategy and operational resilience drove robust interim results, with strong growth in mobile, fiber, and IT services revenue streams.

• Cost optimization, smart capex investments, and non-core asset disposals improved profitability, free cash flow, and balance sheet resilience.

• Retirement fund restructuring and renewable energy initiatives enhanced ESG profile and de-risked the balance sheet.

• Monetization of infrastructure assets advanced, including Swiftnet tower sale and property disposals, pending regulatory approval.

• One-off financial impacts included retirement fund conversion and Google payment, excluded from adjusted EBITDA.

Financial highlights

• Group revenue from continuing operations grew 1.9% year-over-year to R21.4 billion, driven by mobile (10%) and fiber (15.5%) growth.

• Adjusted EBITDA increased 18.3% to R5.6 billion, with margin up 3.6ppts to 26.2%.

• Adjusted HEPS rose 68% to 262.6c, adjusted BEPS up 78.9% to 288.9c, and adjusted profit after tax up 80.3% to R1.4 billion.

• Free cash flow positive at R768 million, supported by improved working capital management.

• Net debt to adjusted EBITDA improved to 1.3x, with interest-bearing debt reduced by R885 million.

Outlook and guidance

• Maintained medium-term guidance: low to mid-single digit revenue and EBITDA growth, capex intensity of 12–15%, and net debt to EBITDA of 1–1.9x.

• Focus on disciplined execution of data-led strategy, operational efficiency, and digital transformation.

• Continued investment in mobile and fiber network expansion, with positive free cash flow and cost optimization as priorities.