Shameel Joosub, Vodacom Group CEO.

Vodafone Egypt has secured a 5G licence for $150 million, while the Vodacom Group subsidiary also extended its existing spectrum licences for five years, to 2039, at a cost of $17 million.

These costs will be paid in the second half of the financial year, according to Vodacom Group, which today revealed its interim results and dividend declaration for the six months ending September 30, 2024.

Vodacom said the 5G licence was awarded by Egypt's Ministry of Communications and Information Technology, represented by the National Telecommunications Regulatory Authority, on October 7, 2024.

The news comes as Egypt has emerged as a shining star in the Vodacom stable, which also includes operations in South Africa, the Democratic Republic of Congo, Ethiopia, Kenya, Lesotho, Mozambique and Tanzania.

In the current reporting period, Vodafone Egypt delivered service revenue of R13.0 billion, contributing 22.1% to the Group service revenue.

Service revenue was up 44.1% in local currency, accelerating marginally to 44.4% in the second quarter, according to Vodacom.

Shameel Joosub, Vodacom Group CEO, commented: “Growth was supported by strong customer engagement in connectivity and excellent growth in Vodafone Cash.

Vodafone Cash is an Egyptian financial services platform based on M-PESA that offers peer-to-peer money transfers, payments, savings products, and microloans to about 3 million customers.

“Egypt closed the period with customers reaching the 50 million milestone. Average revenue per user growth of 34.6% reflected strong commercial traction supported by extensive utilisation of big data and analytics.

“Data traffic was up 32.0% supported by data customer growth of 9.6% to 30.9 million. Smartphones on the network were up 10.8%. In the second quarter, mobile data revenue increased 46.9%.”

Turning to the financial services revenue for Egypt, Joosub said, under the period in review, it was R1.0 billion (EGP2.6 billion), accounting for 7.6% of service revenue.

He went on to say: “In local currency, Vodafone Cash service revenue was up 94.5%. Revenue was supported by customer growth of 43.1% to 9.6 million. Egypt contributed R6.2 billion to Group earnings before interest, taxes, depreciation, and amortisation, (EBITDA), or 23.4%.

“The reported EBITDA margin of 43.4% was up 1.5ppts, reflecting excellent cost control in a high inflation environment. Excluding the impact of foreign exchange trading losses, the EBITDA margin was 45.1%, up 3.4ppts. Operating profit growth was 78.1% in local currency, supporting net income growth of 75.1%.”

Moving to capital investment in Egypt the telco said it invested $125 million (R2.2bn) and it represented a capital intensity ratio of 15.7%.

Joosub said: “We continued to deploy 2 600 MHz spectrum and roll out new sites. Subsequent to the period end we announced a $150 million investment into a 5G licence and extended our existing licences to 2039 for $17.0 million.”

Vodafone Egypt holds a 43% revenue market share, and has 43 million consumer and enterprise customers.

Telecom Egypt, Orange, Etisalat Egypt and Ericsson are some of the other major companies operating in the North African country.