TELKOM RESTORES DIVIDENDS WITH R1.3 BILLION PAYOUT TO SHAREHOLDERS

Telkom has brought cheer to its investors by declaring dividends for the first time in four years, with a total payout of R1.3 billion to shareholders. The company’s Group CEO, Serame Taukobong, expressed satisfaction with this development, stating, “We are pleased to confirm the reinstatement of a dividend, signalling a renewed focus on delivering value to shareholders after a four-year suspension.” The payout comprises both an ordinary and special dividend amounting to R2.61 per share, marking a significant milestone in Telkom’s financial recovery.

The decision to resume dividend payments follows strong operational performance across Telkom’s business units. The Consumer division reported double-digit growth in mobile service revenue, which increased by 10.2 percent, while its mobile data subscriber base grew by an impressive 19.5 percent to reach 15.2 million customers. This expansion contributed to improved profitability, with the division’s EBITDA margin reaching 20.0 percent.

Telkom’s infrastructure business, Openserve, maintained its leadership position in the fibre market with a connectivity rate of 50.4 percent for fibre-to-the-home services. The division achieved steady growth in fibre-related data revenue, which rose by 5.9 percent, while expanding its EBITDA margin to 32.4 percent. Similarly, BCX recorded strong performance with fibre-related data revenue increasing by 12.7 percent and cloud services revenue growing by 5.8 percent.

The company’s property portfolio management through Gyro contributed to financial stability, generating R730 million from the transfer of 57 properties. These strategic asset sales enhanced liquidity and supported Telkom’s ability to reward shareholders while maintaining investment capacity.

Looking forward, Taukobong outlined the company’s strategic priorities, emphasizing, “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.” The CEO highlighted several key objectives, including margin improvement with a target EBITDA range of 25 to 27 percent for continuing operations. This will be achieved through ongoing cost optimization programs and disciplined financial management.

Revenue growth remains a central focus, with Telkom targeting mid-single digit annual increases that outpace inflation across all business segments. The company plans to maintain capital expenditure at 12 to 15 percent of revenue to support future growth while preserving balance sheet strength. Taukobong added, “We aim to sustain the positive free cash flow momentum established to date,” underscoring the importance of financial discipline in the company’s strategy.

While acknowledging South Africa’s economic challenges, including high unemployment rates, Taukobong noted encouraging signs such as moderating inflation and slightly lower interest rates. He reiterated Telkom’s broader societal role, stating, “Telkom recognises its profound societal responsibilities as a provider of a vital service and a national enterprise.” The company remains committed to supporting South Africa’s digital transformation through its extensive network infrastructure.

The dividend reinstatement represents more than just financial reward for shareholders – it signals Telkom’s confidence in its operational turnaround and future prospects. As the company continues to execute its transformation strategy, shareholders can expect sustained value creation through a balanced approach that combines investment in growth opportunities with consistent returns.

Taukobong concluded with a forward-looking statement: “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.” This comprehensive approach positions Telkom for continued success in South Africa’s evolving telecommunications landscape.

2025-06-10T11:00:58Z