After being named as one of South Africa’s Top Employers and being recognised as one of the country’s most reputable brands, Vodacom is backing up this success with an excellent set of quarterly results for the period ending 31 December 2015.
Vodacom sent out a clear message to all stakeholders last month – business is good. As news of the company’s quarterly results for the periodended 31December2015 began to reach the inbox of interested parties, it quickly became clear that the mobile operator had yet again worked hard to bring about healthy figures.
Vodacom reported normalised group revenue up by 7.6% to R21.7bn on the back of strong demand for data. Group data revenue rose by 27.5% to R5.5bn, representing 32% of service revenue. The customer base increased by 6.8% to 65.2m, with data customers up by 14.5% to 30.3m.
These results highlight the strength of the company which was named by Brand Finance at the end of last year as one of the top three most valuable brands in the country.
In November, when the company announced the results for its third quarter of 2015, Vodacom Group CEO Shameel Joosub said: “There are good opportunities ahead of us… In the second half, we plan to invest more into fibre and other new growth areas by building the right capability to ensure we sustain growth into the next year” and this strategy seems to have paid off.
“We successfully executed on our strategy and achieved another quarter of improving revenue trends,” Joosub said in February. “The two biggest highlights in the quarter are the accelerated service revenue growth of 7.2% in South Africa and the 6.8% increase in the Group customer base to 65.2 million. In South Africa, the take-up of our personalised offer ‘Just for You’ was excellent and contributed to the 15.9% reduction in effective voice rates. The International segment delivered robust service revenue growth of 15.2%.
“Our performance in the quarter reflects the positive impact from our substantial network investment of R9.5 billion across all our operations in the nine months.”
The company has taken the lead when it comes to investment in mobile data is looking to develop its share in this growing market in future.
“We have expanded our network coverage and increased data speeds to secure network leadership,” said Joosub.
“Customer demand for high speed mobile data is growing across our footprint, supporting a 27.5% increase in Group data revenue. Active data customers increased 14.5% to 30.3 million as we increased sales of more affordable data devices in the quarter.
“We expect revenue growth to taper slightly into our last quarter of the financial year due to a stronger prior year comparative and a weaker outlook for the consumer in South Africa due to the drought and weaker exchange rate,” he added.
Vodacom is operational in in Tanzania, the Democratic Republic of Congo, Mozambique and Lesotho and provides business services to customers in over 40 African countries such as Nigeria, Zambia, Angola, Kenya, Ghana, Ivory Coast and Cameroon.
In South Africa, Vodacom reportedly boasts more than 23 million customers and claims a huge share of the market. The company’s marketing campaigns are fierce, costing huge amounts of money, reaching vast numbers. Rugby, motor racing and football are just some of the areas where the brand is represented strongly. Some industry experts say that, similarly to Coca-Cola, Vodacom’s relentless marketing is one of the key drivers behind the company’s success.
In good news for Vodacom’s marketing people, the company was being lauded for the excellent work it has done building relationships with its most important resource – its employees.
TOP EMPLOYER
In October, the Top Employer Institute, headquartered in the Netherlands, named Vodacom as one of the country’s top employers, and number one in the telecoms sector, saying: Our comprehensive independent research revealed that Vodacom Group Limited provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and to develop its employees.”
At the award ceremony honouring the country’s top HR performers in Johannesburg, Vodacom Group’s Chief Human Resource Officer Matimba Mbungela said: “We have been certified in one country. Our starting point is South Africa and we are anxiously looking forward to our participation in the rest of the continent.
“I always say that people development is a key priority for the business, not only for HR. We link our people development strategy to our overall business strategy. We ask, where is the business headed in the next three to five years? People talk about data explosion; data has grown a lot in telecoms. Consumers see this happening now but in the industry we planned for this three to five years ago. In doing so, we had to find out what capabilities are needed in the business. This explosion did not happen by mistake, it was planned and therefore we had to invest in our capabilities to make sure we make the best of the opportunity.”
With more than 7400 employees across numerous African nations, Vodacom’s HR structure has become a major part of the business that can quickly decide on the future success of the company.
“We have invested significantly in the right HR operating framework, technology and optimal HR practices to deliver value to the business,” said Mbungela.
STRONG BRAND IMAGE
Marketing the company effectively and creating an environment that allows employees to flourish has had a hugely positive impact on Vodacom. Apart from the obvious success of robust financial results, the company has also been recognised as one of South Africa’s most reputable brands and specifically, the Most Reputable Mobile Network Operator in the country.
In a study compiled by Plus 94 Research and supported by the Mail & Guardian, the country’s top spenders on advertising were put under the microscope and the results were collected and presented as the Top Companies Reputation Index (TCRI).
The study finds which of 50 largest advertising spenders have high public visibility and engagement. Overall, 167 companies were rated in the 2015 Index with Vodacom coming out on top.
“At Vodacom, we strive to be transparent, credible and accountable to our customers, employees, suppliers and partners,” said Vodacom’s Group Chief Officer for Corporate Affairs, Maya Makanjee.
“We are humbled by the vote of confidence in our brand and that our efforts to engage and uphold good governance and management are acknowledged. Furthermore, maintaining a good working environment and contributing to the communities within which we operate have all contributed to our success. Over the years, we have seen how our positive reputation has impacted positively on the growth of our brand and have come to understand the key drivers of our reputation, amongst which are business performance in areas such as innovation, customer service, being a good employer and a responsible corporate citizen.
“As a leader in the telecommunications sector it is important that we maintain a solid reputation. We will continue with our integrated approach towards managing our reputation to ensure that we remain in good standing with all our stakeholders and be a benchmark for good business practice,” says Makanjee.
All of the success that Vodacom has realised in recent months are helping to create a base for ongoing growth in the future. As the company expands into new areas, particularly with mobile data, it can develop assuredly in the knowledge that its employees are well catered for and its customers hold the brand in high-esteem.