Vodacom's first quarter performance: Revenue growth outpaces share price drop

VODACOM Group’s share price slid by 5.46% even though first quarter service revenue growth of 13.8% tracked favourably against the group’s medium-term target of double-digit growth.

- EDWARD WEST

The share price traded at R135.86 on the JSE Wednesday afternoon, after the release of a trading update for the quarter to June 30 - the price was over 42.2% higher than at the same time last year.

“Encouraging trends from Vodacom Group's first quarter performance support the confidence we communicated in May this year, when we upgraded our financial targets, signalling that the organisation is poised for stronger growth in the medium term,” said Vodacom Group CEO Shameel Joosub.

Egypt remained a star performer, having grown service revenue 43.8% in local currency. In South Africa, which accounts for more than half the group service revenue, service revenue increased by 3%, which Vodacom's directors described as “resilient”

Joosub said there had been strong revenue and service revenue growth in rand terms, a healthier performance by the International business, good growth in the contract segment and beyond mobile services in South Africa, and another all-round excellent performance by Egypt.