Contents Group overview Highlights Group at a glance Group structure The Vodafone advantage Our history Our values Our strategy
Group at a glance Vodacom is a leading African communications group providing mobile communications and related services to 39.
Group structure 65% Vodafone Vodacom Group1 14% Government of South Africa 21% Public Vodacom SA 93.75% 2 Vodacom Service Provi
The Vodafone advantage Vodafone has a significant global presence, with equity interests in over 30 countries and over 40 partne
Our strategy Vodacom aims to be a leading total communications provider in sub-Saharan Africa. To realise this aim, we are focu
Vodacom’s strategic direction is underpinned by ongoing investments in key areas: maintaining brand leadership; enhancing custo
Outlook As customers continue to contain their spending in the face of ongoing economic weakness, Vodacom will seek to offer gr
Vodacom’s investment case U We are the market leader in four of five countries of operation, we are the largest broadband provid
Five-year review Year ended 31 March Notes 2009 2008 Summarised income statement Revenue Operating profit Net finance costs Profit
2007 2006 2005 Compound growth % Notes 1. Operating profit and the operating profit margin in 2009 were impacted by the BBBEE cha
GROW CORE MOBILE BUSINESS We serve nearly 40 million customers in five countries with a total population of more than 180 millio
Chairman’s statement This is a time for review and renewal. As a publicly listed entity, and a subsidiary of a leading multinat
The quality of Vodacom’s leadership bench extends to a strong and balanced Board, structured to meet the JSE Limited listing re
Chairman’s statement continued Focusing on stakeholder relations and sustainability In South Africa, we pay our respects to the
Vodacom is encouraging the sporting public to get involved in corporate citizenship by supporting South Africa’s rugby, golf an
Board of directors Independent non-executive directors 1 2 Towards Total Communications Performance review 3 4 22 Group Annual
1. Mthandazo Peter Moyo (46) Chairman of the Board Peter holds a Bachelor of Accounting Science from UNISA, a Higher Diploma in
Board of directors Non-executive directors (Vodafone representatives) 1 2 Towards Total Communications Performance review 3 4 5
1. Michael Joseph (63) Michael holds a Bachelor of Science in Electrical Engineering from the University of Cape Town and is a
Executive committee 1 Towards Total Communications Performance review 2 3 4 5 6 26 Group Annual Report 2009
1. Petrus Johannes Uys (Pieter) (46) Chief Executive Officer (Executive director) Pieter holds Bachelor of Science and Master of
Chief Executive Officer’s review During the past year Vodacom started its transformation into a total communications provider. O
Revenue rose 14.5% to R55 187 million, largely as a result of a 16.5% increase in our customer base to 39.6 million and the 28.
Chief Executive Officer’s review continued to distribution has always been to incentivise loyalty in our distribution channels b
Gateway continued to extend its network in the period with the opening of two new offices in Kenya and Uganda, and launched IPJe
Chief Executive Officer’s review continued Outlook Vodafone’s 15% increase in its shareholding in Vodacom to 65% at the time of
“Vodacom Business has been established to compete in the South African enterprise communications market,” says Wally Beelders,
Chief Financial Officer’s review A number of significant events affected the financial results: the Vodacom SA BBBEE transaction,
A number of significant events affected the financial results: the Vodacom SA BBBEE transaction, the acquisition of Gateway and t
Chief Financial Officer’s review continued Group operating results Year ended 31 March Rm Revenue Other operating income Direct
Revenue Revenue rose 14.5% to R55 187 million, largely due to a 16.5% increase in the customer base to 39.6 million, the 28.8%
Chief Financial Officer’s review continued Group operating profit Year ended 31 March Rm South Africa International Tanzania DRC
Taxation The taxation expense for the year was 1.6% lower at R4 045 million mainly due to lower profit before taxation and a red
Chief Financial Officer’s review continued Segment performance South Africa Year ended 31 March Rm Airtime and access Data Inter
Operating expenses Direct network operating cost, which includes cost of connection and retention, interconnection and other di
Chief Financial Officer’s review continued International Year ended 31 March Rm Airtime and access Data Interconnect Equipment s
Operating expenses Direct network operating cost for the year ended 31 March 2009 increased 31.2% to R3 575 million, largely du
Chief Financial Officer’s review continued Cash flow Cash generated from operations remained stable at R16 351 million, compared
Group cumulative capital investment at cost Year ended 31 March Rm South Africa International Tanzania DRC Mozambique Lesotho M
Chief Financial Officer’s review continued Group net debt Year ended 31 March Rm Cash and cash equivalents Bank borrowings Curre
From 2000, Vodacom’s growth was driving more stock through our supply chain than it could comfortably carry. Infrastructure was
South Africa Vodacom SA produced a good set of results for the year ended 31 March 2009. We continued to enjoy strong customer
Highlights U Revenue growth of 10.8% driven by 11.3% growth in customers to 27.6 million U Data revenue up 27.9% to R6.0 billio
South Africa continued Overview Vodacom SA produced a good set of results for the year ended 31 March 2009. We continued to enj
Overall churn reduced by 2.2 percentage points to 40.1%, largely as a result of targeted programmes to reduce churn in the prep
South Africa continued Messaging and data We continued to see strong growth in our messaging and data products. During the year
Products and services Mobile voice Mobile voice services are offered through contract and prepaid packages as well as community
South Africa continued Network technology and infrastructure As at 31 March 2009, Vodacom SA’s GSM and 3G infrastructure covere
single biggest input cost for data services, as well as better manage the service quality. Our construction of 11 metropolitan
South Africa continued Distribution Vodacom’s distribution channels consist of its franchise operation, direct operation, natio
Franchised outlets include Vodashops and Vodacom 4U stores and our cellular mall, Vodaworld. The national franchise stores are
South African key indicators Year ended 31 March 2009 Customers (thousands)1 Prepaid Contract Community services Gross connecti
International We have been effective in defending our market positions in all our markets despite intensifying competition and
Highlights U Strong customer growth of 30.7% to 12.0 million customers U Growth in revenue of 29.9% to R7.0 billion U Data reve
International continued Overview The international operations continued to record strong customer growth, up 30.7% to 12.0 mill
Products and services Mobile voice Mobile voice services are offered through contract and prepaid packages as well as public pa
International continued Country reviews Tanzania Vodacom Tanzania’s revenue for the year ended 31 March 2009 rose 26.3% to R2 9
offset by the connection of lower ARPU customers, an increase in inactive customers and lower usage. In US dollars, ARPU was 14
International continued Vodacom Lesotho’s profit from operations for the year was R166 million and EBITDA was R189 million, up 3
International key indicators Year ended 31 March Rm Customers (thousands) Tanzania DRC Mozambique Lesotho Gross connections (th
Gateway The acquisition of Gateway provides the thrust for Vodacom’s strategic objective to expand in sub-Saharan Africa. The a
Vodacom Group acquired Gateway on 30 December 2008. Gateway is Africa’s largest provider of satellite and terrestrial network i
Gateway continued Business services Gateway offers private satellite networks (VSAT) to major multinational corporations for th
Gateway has been awarded a USD6 million, two-year term contract to provide Etisalat with satellite cellular backhaul to connect
DEVELOP CONVERGED ICT SOLUTIONS Our new generation networks are enabling us to take up the opportunities of liberalising ICT ma