Telkom (TKG) H2 2025 (Q&A) earnings summary

Executive summary

• Delivered strong FY2025 results with group revenue up 3.3% to R43.9 billion and adjusted EBITDA up 25.1% to R11.8 billion, reflecting a data-led strategy and operational leverage.

• Successfully executed the Swiftnet disposal, generating R6.6 billion in cash, used for debt reduction, shareholder returns, and capital investment.

• Dividend policy reinstated after four years, returning R1.3 billion to shareholders via ordinary and special dividends (261cps total, 7.0% yield).

• Embedded sustainability and innovation, with reductions in emissions, increased renewable energy use, and impactful community investments.

• Focused on cost optimisation, network expansion, and digital transformation across all business units.

Financial highlights

• Group revenue from continuing operations rose 3.3% year-over-year to R43.9 billion; adjusted EBITDA margin expanded by 4.7ppts to 26.9%.

• Free cash flow increased 555.2% to R2.8 billion; net debt to EBITDA improved to 0.6x from 1.8x.

• Headline earnings per share from continuing operations rose 62.2% to 467.5c; basic EPS up 128.9% to 1,528c.

• Capex to revenue ratio at 13.3% (R5.8bn invested), focused on fibre and mobile expansion.

• Effective tax rate at 19.1%, below the SA company rate of 27%.

Outlook and guidance

• Medium-term guidance targets mid-single digit revenue growth and 25–27% EBITDA margin through FY28.

• Capex to revenue ratio expected at 12–15%; net debt to EBITDA maintained between 0.5x and 1.5x.

• Free cash flow expected to improve, driven by business performance and cost discipline.

• Focus on expanding mobile and fibre connectivity, accelerating IT services, and disciplined capital allocation.

• EBITDA margin guidance excludes one-off property sales, normalizing to R50–100 million in annual disposals.