Telkom (TKG) H2 2025 earnings summary

Executive summary

• Achieved 3.3% year-over-year revenue growth, driven by a data-led strategy, operational efficiency, and execution of key strategic pillars.

• Significant improvement in free cash flow by ZAR 2.4 billion, with ZAR 1.3 billion returned to shareholders through ordinary and special dividends.

• Concluded Swiftnet disposal, generating ZAR 6.6 billion in cash, strengthening the balance sheet, and enabling a special dividend.

• Reinstated dividend policy after four years, declaring ZAR 1.3 billion in total dividends, including a special dividend from Swiftnet proceeds.

• Maintained focus on sustainability, reducing fuel usage by 47% and emissions by 11%.

Financial highlights

• Group revenue from continuing operations increased by 3.3% to ZAR 43.88 billion, with mobile service revenue up 10.2% and fibre-related service revenue up 10%.

• Adjusted EBITDA rose 25.1% to ZAR 11.79 billion, with margin expanding to 26.9%.

• Adjusted headline earnings per share up 102.4% to 583.2 cents; adjusted basic earnings per share up 128.9% to 681.7 cents.

• Free cash flow surged 555.2% to ZAR 2.78 billion, supporting dividend resumption.

• Net debt to adjusted EBITDA improved to 0.6x from 1.8x, reflecting significant deleveraging.

Outlook and guidance

• Revenue growth guidance raised to mid-single digits for the next three years, with EBITDA margin targets of 25–27% and capex-to-revenue ratio of 12–15%.

• Net debt to EBITDA guidance set at 0.5-1.5x, currently at 0.6x.

• Focus remains on margin optimisation, revenue acceleration, strategic capital allocation, and maintaining a robust balance sheet.