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Vodacom Group Ltd. (VOD), the largest provider of mobile-phone services to South Africans, rose to a record after operations outside the continent’s biggest economy compensated for slower growth in its home market.
Vodacom jumped 5 percent to 116.39 rand, the highest since the company’s May 2009 listing, at its close in Johannesburg. About 3.5 million shares changed hands, 158 percent of the daily average over the past three months.
Earnings per share excluding one-time items jumped 22 percent to 3.96 rand in the six months through September as revenue earned from the services it provides to customers outside South Africa increased 36 percent to 6 billion rand, Johannesburg-based Vodacom said in a statement today. International operations contributed 20 percent of group revenue compared with 16 percent a year earlier.
“The South African numbers didn’t look as bad as we would have expected them to look, even though they were still fairly anemic, but international was a massive surprise,” Khulekani Dlamini, head of research at Cape Town-based Afena Capital, said by phone.
The company, 65 percent owned by Newbury, England-based Vodafone Group Plc (VOD), has focused on expanding operations outside of South Africa to compete with MTN Group Ltd. (MTN) The number of customers in countries including Tanzania and the Democratic Republic of Congo climbed 19 percent and the company plans to introduce mobile-money services to Mozambique and Lesotho in the next nine months, it said.
Vodacom is “on track to deliver” on a forecast outlined in May 2012 of “low single-digit service revenue growth” and an “incremental” expansion of its margin on earnings before interest, tax, depreciation and amortization by improving efficiencies and raising spending by as much as 13 percent of group revenue, Chief Executive Officer Shameel Joosub said in an e-mailed statement.
The company is confident of a positive outcome to a dispute in Congo with Congolese Wireless Network SPRL dating back to 2010 over investment in the business, Joosub said on a conference call to reporters. Previous plans to exit Congo were halted, he said.
“It’s a massive market; once these problems are resolved they should grow quite substantially,” Dlamini said.
The company’s 30-day historical volatility, a measure of stock swings, increased to 23.55 from 22.55 on Nov. 9. The FTSE/JSE Africa All Share Index’s 30-day volatility measure was at 9.15 versus 9.14 previously. A higher reading means an asset’s price can have bigger moves.
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