Vodacom Tanzania Dividend 2025 and What Shareholders Need to Know

Vodacom Tanzania Plc has emerged as one of the most profitable and rewarding companies on the Dar es Salaam Stock Exchange (DSE) following its strong FY2025 results, which saw net profit soar by 69.4%. For shareholders, the most pressing question now is: how much will Vodacom pay in dividends this year, and is it sustainable?

This article dives into Vodacom’s dividend landscape, the numbers behind the payouts, what investors can expect in 2025, and how this aligns with broader profitability and cash flow metrics.

Summary of FY2025 Financial Performance

Before discussing dividends, it’s essential to understand the foundation of Vodacom’s payout ability.

FY2025 Highlights:

• Net profit after tax- TZS 90.5 billion (up 69.4%)
• Earnings per share (EPS)- TZS 40.37 (up from TZS 23.83)
• Free cash flow- TZS 195.4 billion (up 104.1%)
• Operating profit- TZS 208.2 billion (up 55%)
• Total customers- 22.6 million (up 15.7%)

These figures reflect exceptional growth and reinforce Vodacom’s capability to reward shareholders through consistent and generous dividends.

Dividend History (How Vodacom Has Paid Out)

In October 2024, Vodacom Tanzania declared a dividend of TZS 26.7 billion for FY2024. This payout came at a time of strong service revenue growth, primarily driven by M-Pesa, mobile data, and improved operational efficiencies.

Vodacom Tanzania PLC Dividend (History) Trends:

Vodacom has followed a stable and progressive dividend policy, anchored in profitability and cash flow health. The expected dividend for FY2025 is likely to exceed TZS 30 billion, subject to board and shareholder approval.

What Makes Vodacom’s Dividend Sustainable?

Here are five core reasons why Vodacom’s dividend growth appears sustainable:

1. Robust Earnings Growth

A 69.4% increase in net profit provides a solid financial cushion to support higher payouts without compromising reinvestment in the business.

2. Strong Free Cash Flow

Free cash flow more than doubled in FY2025, reaching TZS 195.4 billion, which is more than 6.5x the FY2024 dividend payout. This leaves ample room for capital investments, debt servicing, and shareholder rewards.

3. Cost Efficiency

Vodacom implemented cost-saving measures that saved TZS 59.2 billion, helping to boost margins and preserve liquidity.

4. Low Capital Intensity

Capital expenditure stood at 11.4% of revenue, down from 13.3% in FY2024, reflecting optimized spending without sacrificing growth.

5. Stable Market Leadership

With a 31.9% mobile market share and 40.4% of mobile financial services users in Tanzania, Vodacom enjoys consistent revenue streams from a loyal customer base.

Dividend Expectations for FY2025

While the exact dividend figure is yet to be confirmed, Vodacom’s board is expected to propose a dividend in line with their long-standing policy. Based on historical payout ratios and FY2025 profits, here’s a projection:

• Projected payout ratio- 30%–40%
• Estimated dividend range TZS 27–36 billion
• Potential dividend per share (DPS - Between TZS 12 and TZS 18

These projections are well-supported by the company’s EPS of TZS 40.37 and ample cash reserves.

Dividend Policy (A Closer Look)

Vodacom follows a value-based dividend policy, which takes into account:

• Net earnings
• Free cash flow
• Debt levels
• Growth reinvestment needs
• Market and regulatory conditions

This dynamic policy ensures that the company does not overextend its commitments while remaining an attractive option for income-focused investors.

Impact on Vodacom Tanzania PLC Shareholders and Investors

For investors, especially dividend-focused portfolios, Vodacom Tanzania offers:

1. Attractive Dividend Yield

Given the modest share price on the DSE and the anticipated DPS, Vodacom could deliver a dividend yield of 6%–8%, which is among the highest for listed Tanzanian firms.

2. Dividend Reliability

The company has never skipped a dividend since its IPO, demonstrating consistency even during uncertain macroeconomic periods.

3. Capital Appreciation Potential

Alongside dividends, Vodacom’s strong earnings and expanding digital services create the potential for capital gains over the medium to long term.

Risks to Watch

While Vodacom’s outlook is positive, investors should remain aware of:

• Foreign exchange volatility - TZS weakness could impact imported technology costs.
• Regulatory changes - New tax or spectrum fees could affect margins.
• Market competition - Pressure from Tigo, Airtel, and Halotel in pricing and mobile money.

However, these risks are largely mitigated by Vodacom’s scale, brand trust, and product diversification.

Final Thoughts (Vodacom Tanzania as a Dividend Powerhouse)

Vodacom Tanzania continues to impress not only as a telecom and fintech leader but also as a top dividend stock in East Africa. With record-breaking profits, prudent capital allocation, and a history of payouts, shareholders have strong reasons to remain bullish.

As the company prepares to propose its FY2025 dividend in the upcoming Annual General Meeting, long-term investors can look forward to yet another year of reliable and possibly increased income.

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