JSE Sens
TELKOM SA SOC LIMITED - Annual Results and ordinary and special dividend declaration for the year ended 31 March 2025 (FY2025)
2025/06/10 07:15:00Download PDF Stock report
Annual Results and ordinary and special dividend declaration for the year ended 31 March 2025 (FY2025)
Telkom SA SOC Limited
Registration number 1991/005476/30
JSE share code: TKG
JSE bond code: BITEL
ISIN: ZAE000044897
('Telkom', the 'Company' or the 'Group')
Annual Results and ordinary and special dividend declaration for the year ended 31 March 2025 (FY2025)
Telkom returns R1.3 billion to shareholders on the back of successful strategy execution in FY2025 and
sets a new roadmap for continued profitable growth
Group highlights for continuing operations
- Group revenue up 3.3% to R43 880m due to strong growth in mobile service revenue up 10.2%
and fibre-related data revenue up 10.0%
- Group adjusted EBITDA(1),(2),(3) significantly up by 25.1% to R11 792m
- Group adjusted EBITDA margin(1),(2),(3) expanded by 4.7 percentage points to 26.9% due
to cost-optimisation initiatives
- Positive free cash flow(2) of R2 778m, resulting from strong operating cash generation,
a R2 354m improvement
- Balance sheet strength restored with net debt(2) to Group adjusted EBITDA(1),(2),(3)
down from 1.8x to 0.6x and interest-bearing debt reduced by R2 600m
- Dividend resumption - 163 cents per share (cps) ordinary dividend declared off strong
operational performance plus a 98 cps special dividend
- Masts and towers disposal concluded, with R6 618m cash proceeds received
Summary financial results
Financial indicators Reported Reported Reported Adjusted(3) Adjusted(3)
Rm FY2025 FY2024 % change FY2025 % change
Revenue 44 572 43 230 3.1 - -
Continuing 43 880 42 463 3.3 - -
Discontinued(4) 692 767 (9.8) - -
EBITDA(1),(2) 15 939 10 041 58.7 16 717 66.5
Continuing 11 014 9 428 16.8 11 792 25.1
Discontinued(4) 4 925 613 703.4 4 925 703.4
Profit for the year 7 503 1 881 298.9 8 071 329.1
Continuing 2 783 1 454 91.4 3 351 130.5
Discontinued(4) 4 720 427 1005.4 4 720 1005.4
Basic earnings per share (cents) 1528.1 385.5 296.4 1643.7 326.4
Continuing 566.0 297.8 90.1 681.7 128.9
Discontinued(4) 962.0 87.7 996.9 962.0 996.9
Headline earnings per share (cents)(2) 544.5 376.0 44.8 660.2 75.6
Continuing 467.5 288.1 62.3 583.2 102.4
Discontinued(4)) 77.0 87.9 (12.4) 77.0 (12.4)
Dividend (cps) 260.87 - 100.0 - -
(1) Earnings before interest, tax, depreciation and amortization.
(2) This is a non-IFRS financial measure.
(3) Adjusted financial measures exclude the impact of the R160 million restructuring cost, and the
Telkom Retirement Fund derecognition loss of R618 million in continuing operations.
(4) Swiftnet continued to meet the IFRS 5 requirements and was classified as held for sale and was
therefore excluded from the results for continuing operations. Telkom disposed of its 100% equity
shareholding in Swiftnet effective 31 January 2025.
Message from Serame Taukobong, Group CEO
Strategic vision realised - Exceptional results and a focused future
Telkom's strategic vision is translating into exceptional results, demonstrating our unwavering commitment
to strengthening our position as the digital backbone of South Africa. Our data-centric strategy continues
to be the key driver, enabling us to deliver sustained, impressive performance.
The Group's differentiated strategy over the past year centred on three key pillars. The first pillar was
sales engine optimisation. We engineered our sales engine to prioritise efficiency, streamlining regional
teams into agile, data-driven units and investing in digital tools to empower frontline teams. The second
pillar was network excellence. We prioritised strategic investments in our infrastructure, expanding fibre
and 4G/5G coverage to underserved areas while enhancing urban network performance. The final pillar was
customer-centric value. We continued disrupting the market by expanding our flexible, affordable plans
tailored to diverse segments, from data-centric bundles for cost-conscious users to seamless connectivity
solutions for small, medium and large enterprises. We supported these with transparent pricing and proactive
service.
While Group data revenue performance remained strong, the Group's EBITDA(1) and cash flow growth were fuelled
by a combination of successful strategies. Mobile and fibre service revenue growth across the Group, along with
effective cost efficiency programmes, improved Group adjusted EBITDA(1),(2) by 25.1% and drove a 19.3%
year-on-year increase in cash flow from underlying operations(2).
We are pleased to confirm the reinstatement of a dividend, signalling a renewed focus on delivering value to
shareholders after a four-year suspension. Our revised and Board-approved dividend policy aims to maintain a
strong balance sheet, provide a buffer for potential economic downturns, and fund future capital investments.
In line with the policy, this year's robust performance and strategic execution allow us to share the fruits
of our success with shareholders by distributing both an ordinary and a special dividend. In total, the Group
will return R1.3 billion or R2.61 per share to its shareholders.
Growth powered by connectivity and digital transformation
Telkom Consumer
- Mobile service revenue increased by 10.2%
- 19.5% upsurge in our mobile data subscriber base to 15.2 million
- Expanded EBITDA margin to 20.0%
Openserve
- Fibre-related data revenue growth of 5.9%
- 50.4% market-leading fibre to the home (FTTH) connectivity rate
- EBITDA margin expansion to 32.4%
BCX
- Fibre-related data revenue increase of 12.7%
- Cloud services revenue growth of 5.8%
- H2 EBITDA margin of 13.2%
Gyro
- Total cash proceeds of R730 million realised from the transfer of 57 properties
contributed to improved liquidity
Outlook
Leveraging our current momentum, we are setting ambitious yet achievable objectives for the next three years.
We will continue to navigate global macro-economic uncertainties and domestic challenges like high
unemployment and the need for sustained economic growth to support our connectivity businesses. At the same
time, we are encouraged by positive signals in South Africa, including moderating inflation and marginally
lower interest rates.
Maintaining a strong balance sheet remains a top priority, enabling us to invest in profitable growth without
compromising our resilience. We aim to sustain the positive free cash flow momentum established to date.
Our focus on efficiency is about holistic performance optimisation. We apply a comprehensive approach that
considers every element of our business, from technology and processes to people and partnerships. We are
actively reshaping the business structure to improve returns while preserving our core strengths.
Our medium-term objectives are focused on driving sustainable growth and enhanced value creation across our
diverse portfolio. These objectives include:
- Margin optimisation: We anticipate improved EBITDA margins for ongoing operations, ranging between 25% and
27%. This should result from achieving a 25% cost to 75% income ratio for continuing operations
(excluding property sales) in FY2025 and building on this base while continuing with our cost-optimisation
programmes
- Revenue acceleration: Driving top-line revenue growth across all businesses to exceed inflation. We project
annual revenue growth in the mid- single digits
- Strategic capital allocation: Maintaining capital expenditure for future growth within a range of 12% to 15%
of revenue
- Balance sheet strength: Preserving a robust balance sheet with a net debt to EBITDA ratio between 0.5x and 1.5x
Essential to achieving these financial targets is continued stability in South Africa, a growing economy supported
by a macro-economic environment that does not deteriorate from current levels, and a stabilised energy supply.
Telkom recognises its profound societal responsibilities as a provider of a vital service and a national enterprise.
As the backbone of the country's digital infrastructure, we are deeply committed to driving national digital
transformation and leveraging our extensive network resources to contribute significantly to South Africa's future.
Declaration of ordinary and special dividend
In line with our dividend policy, the Board declared a final ordinary dividend number 27 of 163.04723 cents per
ordinary share and a special dividend of 97.82051 cents per ordinary share in respect of 31 March 2025. The ordinary
dividend has been declared out of available cash balances and the special dividend has been declared out of the cash
proceeds from the Swiftnet disposal. This takes the total dividend for FY2025 to 260.86774 cents per share (cps)
(FY2024: Rnil).
The dividends will be subject to a local dividend withholding tax to those shareholders who are not exempt from
paying dividend withholding tax.
Dividend Gross amount Dividend withholding tax Net amount
Ordinary 163.04723 cps 20% 130.43778 cps
Special 97.82051 cps 20% 78.25641 cps
The number of ordinary shares in issue at the date of this declaration is 511 140 239. Telkom SA SOC Ltd's tax
reference number is 9/414/001/710.
Salient dates regarding the ordinary and special dividends are as follows:
Declaration date Tuesday, 10 June 2025
Finalisation date Monday, 30 June 2025
Last date to trade cum dividends Tuesday, 8 July 2025
Shares trade ex-dividend Wednesday, 9 July 2025
Record date Friday, 11 July 2025
Payment date Monday, 14 July 2025
Share certificates may not be dematerialised or rematerialised between Wednesday, 9 July 2025 and Friday, 11 July 2025,
both days inclusive. On Monday, 14 July 2025, dividends due to holders of certificated securities on the South African
register will be transferred electronically to shareholders' bank accounts. Dividends in respect of dematerialised
shareholders will be credited to shareholders' accounts with their relevant central securities depository participant
or broker.
Payment of the special dividend is subject to Exchange Control approval. A further announcement will be released on
SENS by no later than the finalisation date, once such approval has been obtained.
Pro forma financial information
The Group presents various non-IFRS financial measures in the results announcement. These non-IFRS financial measures
include i) the net debt and ii) the free cash flow. In addition to the non-IFRS financial measures noted above, the
financial information in the current financial year excludes the impact of restructuring costs as well as the loss
with the derecognition of the Telkom Retirement Fund (TRF) and the related tax impact on the results. These measures
constitute pro forma financial information and are annotated throughout the results announcement. The pro forma
financial information was presented to illustrate the impact of the pro forma adjustments on the audited consolidated
annual financial statements for the year ended 31 March 2025 to achieve a comparable year-on-year analysis and show the
adjusted performance of the business. The pro forma adjustments were determined in terms of the Group accounting
policies disclosed in the audited consolidated annual financial statements for the year ended 31 March 2025. The pro
forma financial information is the responsibility of the Directors and because of its nature, may not fairly present
the financial position, changes in equity, results of operations or cash flows of Telkom.
Further information
The short-form announcement is the responsibility of the Board. It is only a summary of the information contained in
the annual financial statements for the year ended 31 March 2025 (AFS 2025) and does not contain full or complete
details. Any investment decisions should be based on the AFS 2025 published on the JSE's cloud link on
Tuesday, 10 June 2025 and also available on Telkom's website. The outlook statement has not been reviewed or reported
on by Telkom's external auditor.
The pro forma financial information contained in this results announcement was reported on by the Group's independent
external auditor. The AFS 2025, which includes the unmodified opinion of the Group's external auditor,
PricewaterhouseCoopers Inc., and their unmodified reasonable assurance report prepared in terms of ISAE 3420, is
available on the Company's website at: https://group.telkom.co.za/ir/financialinformation.html and on the JSE's cloud
link at: https://senspdf.jse.co.za/documents/2025/jse/isse/TKG/ye2025.pdf.
Copies of the AFS 2025 may be requested from our Group Company Secretary, Ephy Motlhamme at motlhae1@telkom.co.za. The
transfer secretaries are Computershare Investor Services Proprietary Limited and they are contactable on +27 11 370 5000.
Mvuleni Geoffrey Qhena Serame Taukobong Nonkululeko Dlamini
Chairman Group Chief Executive Officer Group Chief Financial Officer
10 June 2025
Sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Ltd
Investor relations contact
Nondyebo Mqulwana
mqulwan1@telkom.co.za
Media contact
Batlile Phaladi
phaladrm@telkom.co.za
Date: 10-06-2025 07:15:00
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.