Fibre network operators (FNOs) Dark Fibre Africa (DFA) and Vumatel have jointly posted revenue of over R6 billion.
This was disclosed when JSE-listed Remgro today announced its financial results for the year ended 30 June.
DFA and Vumatel are controlled by Remgro unit Community Investment Ventures Holdings (CIVH), which recently merged the FNOs into one entity now known as Maziv.
Former Vodacom CEO Pieter Uys is CIVH chairman at Remgro.
In a statement, Remgro says CIVH’s contribution to Remgro’s headline earnings amounted to R206 million (2022: R47 million).
It explains the increase in earnings is mainly due to improved performances by CIVH’s underlying businesses.
According to the company, the performance of these entities, being mainly DFA and Vumatel, improved due to network expansion, partly offset by an increase in finance costs.
DFA’s revenue increased by 6.8% to R2.65 billion, while its annuity income increased to R213 million per month at 31 March 2023 (31 March 2022: R198 million per month).
Vumatel’s revenue increased by 15.1% to R3.43 billion, driven by its fibre infrastructure expansion programme and subscriber uptake growth, Remgro notes.
The revenue growth for the companies follows a marked increase in the demand for fibre internet connectivity in South Africa after the outbreak of the COVID-19 pandemic.
DFA is an open-access fibre infrastructure and connectivity provider in South Africa.
It builds, installs, manages and maintains a fibre network to transmit metro and long-haul telecommunications traffic, which is leased to its customers (telecoms companies and ISPs) using an open-access wholesale commercial model.
DFA has in excess of 13 600km of fibre assets in the ground and owns fibre networks in Johannesburg, Cape Town, Durban, Midrand, Centurion and Pretoria, as well as other smaller metros, such as East London, Polokwane, Tlokwe, Emalahleni and George.
Vumatel is an open-access fibre-to-the-home provider and leases its infrastructure to internet service providers which, in turn, provide broadband retail internet services to end-customers.
The results come after the Competition Commission recently threw a curve ball in the planned merger between Maziv and mobile network operator Vodacom.
Under the proposed deal, Vodacom will, through a combination of assets of approximately R4.2 billion and cash of at least R6 billion, acquire up to 40% of the ordinary shares of Maziv.
Says Remgro in a statement: “As a result of the proposed transaction, Remgro’s indirect interest in DFA and Vumatel will dilute with the entrance of Vodacom as a shareholder; however, Remgro will also obtain an indirect interest in the assets contributed by Vodacom.”
It adds: “During August 2023, the Competition Commission announced its non-binding recommendation to the Competition Tribunal, to prohibit the proposed transaction.
“Remgro and CIVH remain committed to the proposed transaction and firmly believe that, should the implementation of the proposed transaction ultimately be permitted by the Competition Tribunal, it will deliver significant benefits to South African consumers and the broader economy.”