Vodacom Group (VOD) Q1 2027 TU earnings summary

Executive summary

• Completed acquisition of a controlling stake in Safaricom, increasing shareholding from 35% to 55%, consolidating its results and enhancing scale, diversification, and growth prospects.

• Group revenue rose 5.9% year-over-year to R42.4 billion, with normalised growth at 11.4% due to currency effects.

• Strengthened fixed strategy in South Africa with an additional ZAR 800 million investment in Maziv, expanding fiber reach to nearly 3 million homes and over 45% market share of homes connected.

• Upgraded medium-term EBITDA and operating free cash flow targets to early teens growth, and Vision 2030 revenue ambition raised from ZAR 200 billion to over ZAR 300 billion.

• Beyond mobile services, including fintech, now expected to contribute more than 32% of group service revenue.

Financial highlights

• Group service revenue grew 6.3% in ZAR and 12.6% on a normalized basis, supported by strong performances in Egypt and international markets.

• Financial Services revenue up 17.8% in ZAR to ZAR 4.5 billion; normalized growth at 27%.

• Egypt revenue up 18.7% in ZAR (36.3% in local currency), with service revenue up 32.8%.

• International business service revenue up 4.1% in ZAR (14% normalized), with M-PESA revenue up 23.5% in local currency.

• South Africa service revenue grew 2% to ZAR 16.1 billion; prepaid data revenue up 9.4%.

Outlook and guidance

• Upgraded medium-term EBITDA and operating free cash flow growth to early teens.

• Vision 2030 Group revenue ambition raised from over R200 billion to over R300 billion.

• FY 2027 dividend expected to increase compared to FY 2026, despite a reduced payout ratio.

• Egypt expected to maintain early 30s growth in service revenue for the year.

• Safaricom Ethiopia on track for EBITDA breakeven by FY 2027.