UK-based Vodafone, which owns half of Vodacom, will identify "selective" opportunities in emerging markets to increase its footprint.
In addition, the company will "take opportunities to increase stakes in existing markets, with a view to gaining control where possible over time".
The Eastern Europe, Middle East, Africa, Asia and Pacific area (EMAPA) region accounted for more than 70% of the organic growth in revenue during its half-year.
Europe and other operations also grew organically and the EMAPA region accounted for all the growth in reported revenue. Its high-growth markets in this region performed well and grew organically at 13.7% year-on-year.
The cellular company's strategy in this region was to build on its "strong track record of creating value in emerging markets, having delivered strong performances over time in markets such as Egypt and SA".
Once-off impact
The company, which has over 191 million proportionate customers, yesterday announced its results for the six months to the end of September; a day after unlisted Vodacom said it had achieved revenue growth of 20.3%, to R19.5 billion. Vodacom's after-tax profit moved up 30.4%, to R3.1 billion, for the six months to end-September.
Vodafone achieved group revenue of lb15.6 billion, with organic growth of 4.1%. However, due to several once-off items, the company reported a loss of lb3.3 billion before tax, and a loss for the half-year of lb4.5 billion.
Stripping out the once-offs, it would have reported pre-tax profit of lb4.7 billion, and attributable profit of lb3.4 billion. CEO Arun Sarin says the results indicate the company is on track to deliver on its key targets for this financial year.
Developing markets
"Competitive and regulatory pressures in the European region have been offset by strong performances in our developing markets and the US," notes Sarin.
It attributes its revenue increases to organic growth of 4.1% and the impact from the acquisitions in the Czech Republic, Turkey and India, as well as the stake increases in Romania and SA.
Its focus on SA and Egypt paid dividends in the first half of the year, with organic service revenue growth of 40.2% in Egypt and 20.8% in SA. "Our more recent acquisitions are performing very well, with first half year-on-year organic service revenue growth of 31.3% in Romania and 14.4% in the Czech Republic," says Sarin.
"In Turkey, we are very pleased with progress and the company is performing well ahead of its acquisition business plan. In India, organic revenue growth was greater than 50%. All of these performances are ahead of our expectations at the time of each acquisition."
There was no change to Vodafone's prediction of full-year organic proportional revenue growth, which it expects to range between 5% and 6.5%. It sees its organic mobile earnings before interest, taxes, depreciation and amortisation margin around a percentage point lower than last year.
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