Vox hungry for more

Kimberly Guest
By Kimberly Guest, ITWeb contributor
Johannesburg, 16 Nov 2007

The sterling annual results posted by AltX-listed Vox Telecom yesterday will soon be outstripped, says Vox executive chairman Tony van Marken.

"We`ve had a great year. The acquisitions we`ve made in 2006 and 2007 are all having a positive effect on the business. Also we have been driving very good organic growth. It`s not just that we are stealing market share, but rather that the pie is increasing significantly. From this point, it`s only going to step up," he said.

The company, which reported a 404% increase in revenue, to R990 million, says the recently announced acquisitions of Storm Telecoms and Absa Internet Access could boost its revenue to the R2 billion mark in 2008.

These acquisitions currently await approval from the Competition Commission.

Seeking SADC

Vox expects to make more acquisitions in the coming year. However, management warns the rapidly consolidating market is leading to higher purchase prices.

Additionally, the company`s insatiable appetite for growth has its management team considering opportunities outside SA`s borders.

"We`ve built the group to a level which makes us attractive to the SADC regions. We also have enough of a critical mass to make such moves profitable for shareholders. These entries will probably be made by way of joint venture, but I think it`s clear that there are many opportunities out there which we can exploit," he explains.

Although Vox Telecom has seen rampant growth through its acquisitive strategy, Van Marken says it is still looking for returns from organic growth and cross-subsidisation.

"There are many opportunities within the business for cross-selling and maybe even subsidisation like Telkom has done. We are looking to fully exploit these opportunities by getting our voice customers onto our data offerings and vice versa," he explains.

In the 2007 financial year, Vox`s operating profit climbed 373%, to R83 million; profit after tax increased 416%, to R55 million; and earnings per share jumped 143%, to 7.7c.

Related stories:
Vox BEE shareholding rises to 41%
Vox confirms Storm buy
Vox to buy Absa Internet Access
Vox Telecom improves earnings
Is Vox buying Storm?