Telco EBITDA margins
Last week’s newsletter looked at growth in the connectivity segment of the value chain globally. This week’s newsletter looks at some specific examples and trends. In terms of global EBITDA margin, the connectivity segment sits at 30%, which is considerably higher than anywhere else along the value chain. The table shows examples from some Asia Pacific (APAC) countries and there is a wide variation. Indonesia and Thailand have incredible EBITDA margins of around 50%. South Korea is generally improving and moving towards the 30% global average. Australia sits at just about the average of 30%, though there are some worrying signs for Optus (Singtel). EBITDA margins are not showing large declines: those operators that have below 30% EBITDA margins (and that’s a really healthy margin) are steadily improving and those operators that have nearly 50% margins are declining marginally. Overall, this is a picture of a healthy sector, contrary to the doom and gloom forecasts that are de rigueur.
|TPG telecom (Vodafone )||33.5%||32%||32.7%|
|South Korea||Korea Telecom||21.8%||23%||23.3%|
|Source||AFS of MNOs|
Other news from around Africa
- Zambia zero rates importation of telecom equipment: The new administration of President Hichilema has really focused on harmonizing ICT sector and government strategy. Instead of the Finance Ministry working at cross-purposes to the Communications Ministry, they both seem to be on the same page. This is unusual, especially at the moment, where finance ministries are focused on squeezing the last drop of revenues from the ICT sector, regardless of the long term consequences.
- Telkom takeover: MTN and Telkom are still in negotiations and Rain is now added to the mix. Telkom has confirmed an official takeover offer from Rain.