JSE-listed Telkom has tabled its new three-year guidance as its data-led strategy delivers double-digit growth for the year ended March 31.

The medium-term guidance to 2025 had been achieved – and in some cases, exceeded – with the company meeting the targeted low- to mid-single-digit revenue and earnings before interest, taxes, depreciation and amortisation (Ebitda) growth, 12% to 15% capital expenditure (capex) to fund growth and net debt to Ebitda of 1.5x to 1.9x.

The new medium-term guidance for the next three years have been increased to mid-single-digit revenue growth, with an Ebitda margin of between 25% to 27%, and net debt to Ebitda of 0.5x to 1.5x. The group maintained its capex targets of between 12% and 15% in the three years to 2028.

“The results [for the year ended March 31] reflect sustainable momentum in the group’s underlying operational performance as it sets ambitious yet achievable objectives for the next three years, underpinned by the OneTelkom approach,” said Telkom Group CEO Serame Taukobong.

Telkom achieved double-digit adjusted group Ebitda growth of 25.1% to R11.8-billion, with the adjusted Ebitda margin up 4.7 percentage points to 26.9% during the 2025 financial year.

During the year ended March 31, 2025, adjusted headline earnings a share and adjusted basic earnings a share surged 102.4% and 128.9% to 583.2c and 681.7c respectively, driven by improved operational performance.

Telkom’s adjusted profit for the year for continuing operations increased by 130.5% to R3.4-billion.

Telkom also reported significant improvement in free cash flow, which increased by 555.2% to R2.8-billion, primarily owing to a 19.3% increase in the cash generated from operations from the underlying business.

The group’s net debt to adjusted Ebitda was 0.6x during the year under review.

Group revenue edged up 3.3% to R43.9-billion and capex for the year, at R5.83-billion, was maintained at 13.3% of revenue.

Meanwhile, Telkom reinstated its dividend, with intentions of returning a total dividend of R1.3-billion, or 261c a share, which includes an ordinary cash dividend of R833-million, or 163c a share, and a special dividend of R500-million, or 98c a share, from the completed disposal of the Swiftnet masts and towers business. Telkom’s Swiftnet disposal has been concluded, netting R6.6-billion in proceeds.

In 2023, Telkom embarked on a strategy to pursue its vision of serving as the backbone of South Africa’s digital future, starting with the divestment of noncore assets, such as the masts and towers business of Swiftnet and Gyro’s property portfolio, to deliver an optimised asset portfolio, said Taukobong.

The company continued to transform its network assets, including the modernisation of networks and service migration from copper to fibre and voice to data.

“The company has largely modernised its technology infrastructure and executed on a robust, detailed strategy across its operations.”

Operational excellence, sales engine optimisation, network excellence, customer centric value propositions and continued cost optimisation also formed part of its renewed strategy, along with OneTelkom’s “ways of winning” which included focus on people, leadership and sustainability.

The group is now positioned and fit for growth, with three business units operating with shared purpose and momentum: Telkom Consumer, Openserve and BCX.

During the year ended March 31, Telkom Consumer continued to be a “star” performer, increasing operating revenue by 5.6% to R27.8-billion, driven by advanced data analytics, optimisation of the product portfolio and expansion of distribution channels.

External revenue from the mobile business reached R24.4-billion, an 8.3% increase, driven by 10.2% growth in mobile service revenue to R21-billion. Mobile data revenue increased 12.3% to R16.01-billion during the year under review.

Overall mobile subscribers grew by 13.4% to 23.2-million during the year ended March 31.

Mobile’s Ebidta increased 30.3% to R6.56-billion.

Openserve’s overall revenue increased 1.3% to R12.35-billion.

Fibre data revenue increased 5.9% to R9.35-billion, driven by a 13.3% increase in homes passed to 1.38-million and a 50.4% connectivity rate, the highest in the market. Ebitda increased 1.8% to R4-billion.

During the year under review, the business units’ operating revenue split comprised 82% fibre and 18% legacy, compared with the split of 76% fibre and 24% legacy in 2024.

“Network simplification and energy transformation reduced operating costs, and ongoing investment in the fibre network delivered capital intensity of 20.5%,” he added.

BCX’s revenue decline 4.4% to R12.3-billion during the year under review, amid its ongoing strategic transition towards higher-margin services.

The business generated adjusted Ebitda of R1.4-billion before restructuring costs of R157-million, improving by 6.3% compared with the 2024 financial year.

Performance accelerated in the second half as the 9% Ebitda margin rose to 13.2%, reflecting early gains from the cost transformation programme.

Gyro, which manages the group’s property portfolio for core operational purposes, generated R730-million from the sale of 57 noncore properties. An additional 30 properties in the conveyancing process are expected to yield R280-million. The proceeds will support liquidity and strategic reinvestment.