Telkom Hikes Dividend Following Surge in Annual Earnings, JSE: TKG Share Price Aims for R70
Telkom delivered a strong set of annual results driven by data growth, margin expansion, and robust cash generation, reinforcing investor confidence in its ongoing turnaround and supporting continued upside in the TKG share price.
Quick overview
- Telkom reported a 1.4% increase in group revenue to R44.4 billion, driven by a 7.6% rise in data revenue.
- EBITDA rose by 5.8% to R12.5 billion, with headline earnings per share increasing by 21.5% to 708.5 cents.
- The company significantly raised its dividend by 65.7% to 270 cents per share, reflecting improved financial discipline.
- Telkom's share price has recovered by approximately 12% in November, supported by positive investor sentiment and operational improvements.
Telkom delivered a strong set of annual results driven by data growth, margin expansion, and robust cash generation, reinforcing investor confidence in its ongoing turnaround and supporting continued upside in the TKG share price.
Strong Annual Performance
Telkom reported improved profitability and disciplined capital allocation for the year ended 31 March, reinforcing momentum in its transformation strategy. The group continues to show consistent operational improvement, supporting sustained strength in the JSE-listed TKG share price through 2026.
Revenue and Data Growth
Group revenue rose 1.4% to R44.4 billion, supported by a solid 7.6% increase in data revenue to R26.6 billion. Data now accounts for 59.8% of total revenue, up from 56.4% previously, highlighting the ongoing shift toward mobile and fibre-driven services.
Earnings and Cash Flow Strength
EBITDA increased 5.8% to R12.5 billion, while headline earnings per share rose 21.5% to 708.5 cents. Free cash flow climbed 10.4% to R3.07 billion, supported by improved collections, tighter cost control, and stronger operational efficiency.
Dividend Expansion and Shareholder Returns
Telkom lifted its dividend by 65.7% to 270 cents per share, significantly outperforming peers. The increase follows a revised payout policy of 40%–60% of free cash flow, up from 30%–40%. This compares favourably with sector peers, including Vodacom’s 18.5% increase and MTN’s 42.9% rise.
Margins and Cost Discipline
EBITDA margin expanded by 1.2 percentage points to 28.1%, exceeding the group’s medium-term guidance range of 25%–27%. Total costs declined 1.1%, improving the cost-to-income ratio to 73%, reflecting ongoing efficiency gains across the business.
Telkom Share Price Regains Momentum After Months of Weakness
After three consecutive months of retreat, Telkom’s share price has staged a meaningful recovery in November, rising roughly 12% as investors responded positively to improving sentiment. The latest earnings release reinforced this shift, giving the stock an additional push higher on Tuesday. Still, buyers now face a notable resistance band overhead—an area that must be cleared for a run toward the July peak above R60.
TKGJ Chart Weekly – Buyers Need to Break Above the 20 SMA
Technical View: Support Holds, but Key Moving Average Blocks Breakout
From a market perspective, the JSE-listed TKG share price pulled back from its July peak but found reliable support at the 50-week SMA near R45, where buyers re-entered confidently. Over the last two weeks, the stock surged back above R50, signaling revived appetite.
The next test lies at the 20-week SMA, which is acting as immediate resistance. A decisive move above that level would open the path toward the October high above R60, and beyond that, the long-term bullish objective sits at the 2019 record near R100.
Balance Sheet Improvement
Net debt fell 14.7% to R6.37 billion, underscoring stronger financial discipline and improved cash generation capacity.
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- Group Revenue: R44.48 billion, up 1.4% year-over-year.
- Data Revenue: Rose 7.6% to R26.6 billion, now contributing nearly 60% of total group revenue.
- Headline Earnings Per Share (HEPS): 708.5 cents, representing a 21.5% increase from continuing operations.
- EBITDA: R12.48 billion, an increase of 5.8%.
- Dividend: The board increased its dividend payout ratio to 40%–60% of free cash flow, declaring a final ordinary cash dividend of 270 cents per share (a 65.7% increase).
- Mobile Business: Mobile data revenue grew 10.5% with the mobile broadband subscriber base expanding, sustaining service revenue growth for the 14th consecutive quarter.
- Openserve: Reached full-year revenue growth for the first time in nine years (up 2.3% to R12.6 billion), largely driven by an 8.1% increase in fibre-related data revenue.
- BCX: Revenue fell 7.6% to R11.41 billion, driven by the deliberate migration from legacy systems, although IT business revenues remained stable
Strategic Outlook
CEO Serame Taukobong said the results validate Telkom’s transformation strategy, positioning the group for more consistent earnings quality and enhanced shareholder returns. The combination of stronger cash flow, higher margins, and rising dividends continues to reinforce investor confidence in the company’s longer-term growth trajectory.
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