JSE-listed Telkom has reported growth in the first quarter of 2024, with group earnings before interest, taxes, depreciation and amortisation (Ebitda) up 24.1% to R2.78-billion.

In a trading update issued to shareholders on Monday, the group outlined revenue growth of 3.9% to R10.91-billion, driven by growth in demand for its next-generation offerings, for the quarter ended June 30.

“Telkom had a good start to the financial year with pleasing performance on the top-line benefiting from our data-led strategy and compelling value propositions. Our next-generation revenue streams continued their positive momentum and grew by R576-million, an increase of 7%. Next-generation revenues now comprise 80.7% of group revenue,” said Telkom Group CEO Serame Taukobong.

Key contributors to strong next-generation growth include fixed-data next-generation revenue growth of 7.1% and IT revenue growth of 10.3%.

Telkom Consumer recorded a 2.6% increase in revenue to R6.59-billion during the quarter under review, with mobile revenue growing by 5.3% to R5.74-billion and mobile service revenue increasing 9.5% to R5-billion.

“We saw continued momentum in demand for data traffic and mobile with fixed traffic growing 25.8% and 33%, respectively year-on-year. Our mobile subscribers advanced by 14.6% and surpassed the 21-million mark with a stable prepaid average revenue per user and postpaid base, while homes connected with fibre grew by strong double digits, at 19.5% year-on-year,” he said.

Further, Telkom reported a 25.8% increase in mobile data traffic to 414 petabytes, bolstered by a 15.1% increase in mobile broadband subscribers to 13.5-million.

Overall, Telkom Consumer Ebitda increased 28.4% to R1.2-billion, while mobile Ebitda grew by 35.7% to R1.54-billion.

Openserve, meanwhile, reported that its next-generation products and services maintained their upward trajectory, with fixed-data next-generation revenue increasing 7.1%. Next-generation connectivity now represents more than 94% of Openserve's overall external wholesale revenue.

“While we see ongoing growth in next-generation services, the overall revenue declined by 2.4% to R3.05-billion year-on-year, primarily driven by a decline of 28.4% (R188-million) in voice and legacy revenue,” Taukobong commented.

During the quarter to June 30, homes passed increased 13.4% to 1 256 603 and the number of homes connected reached 615 430, a 19.5% increase that led to a connectivity rate of 49%. Data consumption increased 33% to 681 petabytes for the quarter.

Openserve’s Ebitda for the quarter increased 16.8% to R1.02-billion.

Meanwhile, BCX increased its revenue for the first quarter by 2.4% to R3.18-billion, supported by growth in the IT unit, which increased its revenue by 7.1% to R1.79-billion, primarily driven by the continued over-performance of the software and hardware business.

The IT hardware and software business achieved year-on-year revenue growth of 22.5%, driven by an increase in new business and clearing of backlog orders. IT services revenue was stable at R1.11-billion.

The Converged Communications business revenue declined by 3.2% to R1.39-billion, owing to the continued migration from legacy services.

Legacy telephone lines continued to decline and resulted in voice revenue declines of 14.6%, in line with the group’s migration strategy.

Data connectivity revenue, which contributes 33.9% to the Converged Communications revenue, has reached an inflection point with 78.2% of revenue comprising next-generation revenue.

Overall, BCX reported an 8% decline in Ebitda to R253-million.

Swiftnet's revenue during the first quarter increased by 5.2% to R343-million, with revenue from growing customers increasing by 14.5% to R285-million underpinned by inflationary escalations, new tenancies, 5G expansion and antennae upgrades, as well as new tower builds and IBS.

During the quarter, Swiftnet's Ebitda increased by 7.7% to R252-million.

During the quarter ended June 30, Gyro continued to rationalise the property portfolio through accelerated disposal and transfer of properties that are no longer core for the group's operational requirements.

“We began the year with 42 properties with a sales value of R287-million undergoing the conveyancing process, with a target to transfer them during the financial year. From these, we successfully transferred 19 properties, and realised sales proceeds of R161-million in the first quarter,” explained Taukobong.

The first auction for additional properties approved during the quarter was completed in June, resulting in sale offers for nine properties to the value of R33-million. Signature of sale agreements is in progress, ahead of the start of the conveyancing process. Gyro plans to dispose of more noncore properties, including those previously earmarked for property development, during the rest of the year.