africa Finance Fintech Tanzania telecom

Vodacom Tanzania rewards its shareholders with $23.7 million dividends

Vodacom Tanzania Plc – the leading and fastest mobile data network in Tanzania, has recently paid its equity shareholders $23.7 million in dividends.

The payout, in other words, came out rather delightful, due to salient features from the telecom company’s annual reports, showing a $39.1 million annual (end of the year) net profit increase.

Vodacom Tanzania became the first telecom company in Tanzania to get listed in Tanzania’s stock-exchange (Dar es Salaam Stock Exchange -DSE) on August 15th 2017.

According to Vodacom Tanzania, which has over 14 million subscribers, 32.4 per cent of market share and 38.6 per cent of mobile money share, the respective profit was fetched from a significant increase in service revenue which reached $442.9 million, alleviated by firm growth of mobile money, mobile data and messaging services.

And yet, Vodacom Tanzania preliminary report (2019) show, an increase of 1.2 million customers (9.6 per cent increase), 7.4 per cent increase in data customers reaching 7.9 million (of which 45.2 per cent are using smartphones).

Since Vodacom Tanzania got listed in 2017, it has surged its unrelenting efforts to capture a decent share in the telecom market.

Via investing up to $74.4 million (16.7 per cent of its revenue) in expanding its reach, through upgrading capacity and modernizing its network, which means 4G network expansion across major cities in Tanzania.

Throughout the years, Vodacom Tanzania has added 197 3G sites and 322 4G sites to reach a total of 2429 3G sites, and 861 4G sites respectively in major cities.

Further, Vodacom Tanzania trading update (for the quarter ending June 2019) show, mobile money platform (M-Pesa) customer base grew by 6.9 per cent to 7.3 million representing a 50.8 per cent penetration, compared to 7.0 million reported earlier this year.

Also, mobile data customer base increased by 5.5 per cent to 8.1 million, attributed to data campaigns.

Vodacom Tanzania looks confident towards enriching its services in Tanzania, which has seen a stark take-up of telecom services over the past few years.

Translated through $23.7 million paid recently in dividend to equity stakeholders, and also reflected via the $25.6 million invested in remuneration, training and development of Vodacom Tanzania 548 permanent staff, but also provision of indirect employment to over 127,000 Tanzanians, which accounts for: over 106,000 M-Pesa agents, 400 call center agents and more than 1,200 contractors (shops and networks) and with over 20,000 freelancers.

According to firm September 20, press release, during Annual General Meeting , Chairman of Vodacom’s Board of Directors Ali Mufuruki said, “Vodacom is also proud of its social investments which amount to $ 478.6 million trillion shillings cash contributions paid to public finances in taxes, spectrum and regulatory fees over the last three years of which payment of TZS0.4 trillion shillings [$174 million] was made in 2019 alone.”

In regard to Tanzania’s telecom sector with 81 percent penetration (in terms of subscriptions and teledensity) and 43 per cent internet penetration– according to Tanzania Communications Regulatory Authority, Vodacom stands a significant chance to increase its stake in the telecom industry, which means more share profits to shareholders.

However, the latter is substantiated by Mufuruki. “Growth in the telecommunication industry has been sluggish over the year. As a key player in the industry, we are proud to be the driver for growth in this sector.” Mufuruki commented

Source: The Exchange

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