Tanzania Largest Telecom Company Returns to Profits

Tanzania’s largest mobile operator Vodacom has recently posted its preliminary consolidated financial results for the year ended 31 March 2023 which shows that the company generated TZS 44.5 billion in net profits.

In the year ending 31 March 2022, Vodacom posted a net loss after tax of TZS 20.2 billion.

In 2023, the company generated TZS 1 trillion of service revenue, up 10.2%, or 13.2% on an underlying basis, and TZS 81.5 billion operating profit, reflecting a 26.5% increase, or 51.7% on an underlying basis.

Underlying performance includes an estimated add-back of TZS 11.9 billion levy impact on profit after tax and excludes TZS 50.9 billion tax expense saving from deferred tax asset recognition.

The growth was driven by a strong result from mobile data, a recovery in M-Pesa mobile money service and accelerating fixed growth.

The recovery of M-Pesa was partially supported by a reduction in government levies on mobile money transfer and withdrawal transactions.

M-Pesa’s recovery was also supported by a good uptake in new revenue growth areas comprising lending, insurance, international money transfers (IMT) and merchant services.

Outlook and Medium-Term Targets

Vodacom Tanzania’s Managing Director Philip Besiimire explain that “We aspire to grow our business over the medium term by [providing] access to modern technologies and offer technological solutions that are relevant to customers and society. To support our growth ambitions, we will invest in our network and supporting infrastructures, leveraging our segmented multi-products approach known as the system of advantage. This approach combines our unique strengths in connectivity, digital services, and financial services to deliver diversified and differentiated offerings to our customers. We will roll out our fixed access services to both business and consumer segments and drive smartphone penetration to enable access to digital services, including our M-Pesa super-app.”