Financial Performance Overview
Telkom, a prominent South African telecommunications company, announced a 3.4% increase in its group revenue for the six months ended September 30, 2025 (H1 FY2026). The revenue climbed from R21.38 billion to R22.1 billion ($1.28 billion). This growth was primarily propelled by a significant surge in data revenue, which experienced a 7.9% increase, reaching R13.072 billion and constituting 59.1% of the total revenue.
In its financial report released on Tuesday, Telkom highlighted that its headline earnings per share (HEPS), a crucial measure of profitability, rose by 16.4%, a direct result of its data-centric strategic approach. The HEPS increased to 305.6 cents for the six-month period, up from 191.5 cents recorded in the same period the previous year.
Strategic Outlook and Growth Drivers
Group CEO Serame Taukobong emphasized that the company's data-led strategy will continue to serve as a key driver for future growth, underscoring Telkom's robust financial standing. He further stated that the company is committed to reinforcing its distinctive position as the foundational element of South Africa's digital advancement.
"These results demonstrate that we are well-positioned to deliver on the commitments of our medium-term objectives. Additionally, the results reflect the determination and commitment of all our employees, who are relentlessly focused on executing our data-led strategy."
Serame Taukobong, Group CEO
The company's mobile subscriber base expanded by 7.7% year-on-year, growing from 22.8 million to 24.5 million. This expansion was largely attributed to an increase in prepaid mobile subscribers, which saw a 9% year-on-year growth, while the postpaid customer segment experienced a slight decline of 0.6%.
Telkom observed a 10.3% growth in its mobile data revenue and a 12.3% increase in fibre-related data revenue.
Operational Efficiency and Profitability
Telkom's financial leverage remains stable, with its net debt to EBITDA ratio at 0.7x, following the settlement of R4.834 billion in debt during the reporting period. BCX, Telkom's information and communication technology (ICT) business, demonstrated improved operational efficiency, with its EBITDA margin increasing from 6.5% in the first quarter to 9.9% in the first half of fiscal year 2025. This improvement reflects the success of its cost transformation initiatives and portfolio optimization efforts.
Despite the positive revenue and operational trends, the group's net profit for the period was R1.60 billion, representing a 2.1% decrease compared to the net profit reported in the preceding year.
Mobile service revenue saw an increase of 7.9%, and average revenue per user (ARPU) initially increased by 4.1%, contributing to sustained market-leading growth. However, on a year-on-year basis, ARPU saw a decrease of 3.4%, falling from R79.97 to R77.27.
Outlook for the Second Half of Fiscal Year 2025
Building on the positive performance in the first half of fiscal year 2025, Group CEO Serame Taukobong expressed strong confidence in the company's capacity to achieve quality earnings in the upcoming period. For the second half of FY2025, Taukobong indicated that revenue generation will remain a primary focus across the entire Group, supported by ongoing sustainable cost-optimization measures.
He further elaborated on the strategic direction: "We will continue to leverage the unique advantage of our extensive fibre footprint to drive growth through our strong mobile offerings in service and data. We expect to maintain service revenue growth at mid-single digits for the mobile business."
Regarding the EBITDA margin outlook, Taukobong projected a slight moderation. This adjustment is anticipated due to the seasonal nature of investments associated with the summer campaign and the festive season.
He concluded by outlining BCX's operational strategy: "BCX will carry on with disciplined execution of its strategic actions and will focus on growing margin-accretive revenue. We will continue to act decisively in honing high performance by making the most of our strengths as a well-established infraco."