Telkom is committed to achieving net zero greenhouse gas (GHG) emissions across Scope 1, 2 and 3 by 2040, with an interim
goal of carbon neutrality by 2035.
We are steadily increasing investments in renewable energy solutions, energy efficiency upgrades and circular economy initiatives.
These sustainability-focused investments contribute to long-term cost savings, reduced climate risk and regulatory readiness. However, they compete for
funding that could otherwise accelerate our infrastructure rollout or improve customerfacing technologies.
We actively manage this tension between long-term environmental sustainability and short-term commercial growth to ensure neither is compromised.
Impact on strategy and future business model
By lowering the cost to serve, increasing network uptime and expanding the capabilities of our infrastructure, our energy transition is reshaping how we think about value creation.
As we modernise our network with clean technologies, we are positioning Telkom to evolve into a provider of low-carbon digital solutions. Over time, this will enable new
business models and service offerings that respond to changing stakeholder expectations and create additional revenue streams. Examples include green-powered
connectivity and decarbonisation services for enterprise clients.
We continued monetising non-core assets to strengthen our financial position without compromising future growth:
- Disposed of non-core properties through Gyro (R730 million in cash proceeds). This enhanced our liquidity and further optimised operating costs
- The sale of Swiftnet (R6.6 billion in cash proceeds) bolstered Telkom's balance sheet, ensuring greater financial resilience (read more in the GCEO's report)
Asset monetisation reduced our productive capital through the disposal of properties and tower infrastructure. However, it preserved
operational flexibility and safeguarded service delivery. The proceeds have enabled us to continue investing in strategic growth areas.
Impact on strategy and future business model
By streamlining our asset base and freeing up financial capital, we reinforced our financial foundation. This enables us to scale our
digital infrastructure, particularly in fibre and mobile services.
Reducing our debt levels provides flexibility to pursue innovation opportunities while maintaining a resilient and sustainable business model.
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Telkom's dividend policy aims to balance shareholder returns with the imperative to invest in strategic growth areas for
sustainable future performance.
This year, we declared a dividend for the first time since FY2020, demonstrating our commitment to returning value to shareholders while maintaining financial discipline.
Impact on strategy and future business model
Our cautious approach to dividends strengthens our financial health. This enables us to build infrastructure for continued
competitiveness while creating future value for shareholders.
This approach ensures Telkom remains agile to capitalise on emerging opportunities in a changing technological environment while
enhancing its long-term market position.
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Telkom is transitioning from legacy fixed-voice business to next-generation platforms like fibre and mobile broadband. This
involves decommissioning outdated copper and 3G networks, which leads to short-term revenue declines and upfront costs.
Modernising our network involves site consolidation, renewable energy integration and advanced analytics. These projects require significant initial investment,
impacting
near-term cash flow. However, they generate long-term cost savings, enhance network resilience and benefit the environment.
Balancing the short-term financial impact of legacy retirements with the broader rollout of fibre and 5G exemplifies the ongoing and multi-year nature of this strategic shift.
Impact on strategy and future business model
Through this transition, Telkom is evolving into an agile, digitally enabled business. The network modernisation, including 5G and
IoT solutions, enhances our service reliability and customer experience.
The upfront costs of these changes are strategic investments that will ultimately reduce operating expenses and improve operational efficiency.
Over the long term, this will strengthen
Telkom's market position and enable sustainable growth in the broadband and mobile sectors.
Telkom is creating differentiated, data-driven customer experiences by investing in advanced AI platforms. These platforms
enable personalised services, faster issue resolution and deeper customer insights. However, they require significant upfront
investments in AI infrastructure, data management systems and talent acquisition.
They also bring operational challenges, including data privacy and change management issues. We need to ensure that the new systems enhance customer
experiences without disrupting service quality or operational stability.
Balancing the pace of technological deployment with strong governance and employee upskilling is important to ensure the long-term success of these investments.
Impact on strategy and future business model
The shift towards AI and data-driven solutions is integral to Telkom's strategy. By integrating AI into our service delivery architecture, we are improving customer
engagement and opening new revenue streams, such as predictive analytics services for enterprise clients.
Expanded use of AI will reshape Telkom's business model by enabling more proactive, automated interactions with customers. This will reduce the cost to serve and increase
operational efficiencies.
Our investment in AI will drive long-term growth by enhancing the scalability of our services and enabling us to deliver innovative products tailored to customer
needs.
