Our business model

Blue Label’s resources are divided into six capitals by the <IR> Framework, which considers how an organisation’s operations and results impact or change these resources. We weigh the trade-offs between the various value drivers and every choice we make aims to maximise benefits and minimise drawbacks.

CAPITALS

INPUTS

Financial capital
  • Equity capital
  • Debt capital
  • Working capital
  • Capital expenditure: R88 million
Manufactured capital

Property, plant and equipment to the value of R88 million, including:

  • R21 million vending machines and terminal devices;
  • R32 million computer equipment; and
  • R16 million media equipment.
Intellectual capital
  • Additions to intangible assets: R165 million
  • Software development spend: R117 million
  • Market insight and data
  • Entrepreneurial culture and agile practices
  • Operating systems, policies, processes and procedures
  • Reporting and communication
  • Proprietary technology, software and IT systems
  • Targeted analytical processes, machine learning and artificial intelligence (AI)
Human capital
  • Employees: 1 150
  • Salaries and benefits spend: R962 million
  • Experienced Board, executive and senior management
  • Performance management system
  • Leadership development programme
Social and relationship capital
  • Relationships with all stakeholder groups, including:
    • Employees, customers, shareholders, government and regulators, partners and suppliers and media.
  • SED spend: R11.6 million
Natural capital

Includes continuing subsidiary operations. Excluding offshore, discontinued and sold operations, as well as associate and joint ventures.

2024  2023*
R'000  Usage    R'000  Usage  % increase/(decrease) in spend  % increase/(decrease) in usage 
Electricity  4 372   1 827 047   kWh   4 017  2 038 978  kWh  (10)
Water  696   12 420   KL   552  11 356  KL  26 
Petrol  9 459   401 950   L   13 664  584 780  (31) (31)
Diesel  2 358   95 924   L   2 671  104 763  (12) (8)
Paper  205   7 390   kg   195  7 255  kg 

* The comparative numbers have been restated for the cessation of operations of Mobile Macs Proprietary Limited.

In line with Blue Label Distribution’s cost optimisation objectives, the closure of several regional offices and fleet reductions led to a reduction in their consumption of electricity, water and fuel. The head office canteen and car wash resumed full function midway through the 2023 financial year resulting in an increase in water consumption in 2024. The reduction in load shedding experienced in the 2024 financial year, resulted in savings on generator diesel consumption. Continued efforts to transition to a paperless environment confined paper consumption to acceptable levels.

OUTCOMES

A strong balance sheet and sufficient working capital to fund the operations that support long-term sustainability

  • Revenue: R14.6 billion
  • Gross profit: R3.3 billion

Economic benefits for stakeholders:

  • Finance activities: R45 million outflow
  • Lease payments: R17 million
  • Taxes paid: R187 million
  • Employee salaries and benefits: R962 million
  • Ability to deliver valuable services and solutions in response to changing consumer demands
  • Strategically located outlets offering convenient customer access to products and services
  • Proprietary systems/solutions add value and secure sophisticated contracts
  • Accelerating our digitisation projects to fast-track our ability to be responsive to our new environment
  • Improved responses to changing consumer needs
  • Brand reinforcement and market communication
  • Accelerated deployment of new technologies
  • Effective controls and processes
  • Creative solutions increase productivity, cost savings and synergies
  • Building an organisation that is future fit, inclusive business with a growth mindset
  • Employee well-being is part of our strategy to succeed
  • Employee engagement is more centred around creating meaningful jobs and creating an environment that creates purpose
  • A vibrant, diverse and flexible workforce committed to the long-term success of Blue Label:
    • 45% of Blue Label's workforce is female;
    • 82% of new recruits are black; and
    • 76% of the people appointed in managerial roles are black
  • Inclusive leadership that promotes innovation, teamwork and job satisfaction
  • Building sustainability programmes that impact communities and youth development
  • Initiatives aimed to build entrepreneurs and SMMEs
  • Supporting flagship beneficiaries that align with our shared socio-economic values through the Trust Blu Foundation
  • Business efficiency through collaboration with producers and suppliers
  • Building trust and respect
  • Social relevance in the communities we operate in
  • Brand reinforcement and market communication
  • Sustained confidence from shareholders and investors
  • We are aware of the environmental impacts of our operations and activities. We pursue the responsible management of waste and emissions, with a focus on the sustainable use of our resources
  • Blue Label views digital products and services as having significant potential to deliver positive environmental outcomes

heading2

Our business model and the use of the capitals to create value for all our stakeholders are underpinned by robust corporate governance, as outlined on ESG Reporting index.

TRADE-OFFS

Short-term investment
vs long-term benefit

There is an important trade-off between short and long‑term investment associated with financial capital.
It is important to balance the interest of short-term benefits with those of long-term sustainable growth objectives. While both are important for different stakeholders at different times, it is a key focus in our strategic decision-making process.

Automation and
human capital

Automation of routine tasks through technology may in the long term reduce human capital. Blue Label's approach is to find value-creating opportunities in new and evolving technologies that support our employees and our communities in their work.

Fast-paced innovation

Our technical innovation and entrepreneurial drive are central to effectively serving the unbanked market segment and those without access to technology. The adoption of new technologies, as well as processes and systems that are faster and more efficient, requires effective change management with employees and subsidiaries.

Responding to social and
environmental issues

Climate change is increasingly in the spotlight as the effects of global warming start to show up in severe weather events across the world. At the same time, social challenges and inequality are thrown into sharp relief, especially in developing countries. In choosing where best to allocate Blue Label's financial resources to make the world a better place, we consider solving social issues as central to our purpose and vision and therefore more material.

OUR DIVISIONS AND OFFERINGS

Blue Label’s varied product and service offering enables us to provide mainstream products and services to a broader clientele. Blue Label’s divisions are illustrated below. (Unless otherwise stated, all entities are wholly owned by Blue Label).

AFRICA DISTRIBUTION

Blue Label Distribution (BLD) is a specialist in prepaid products and the electronic distribution of virtual merchandise across South Africa. They have an extensive distribution network that includes banks, retailers, spaza shops, informal traders and petroleum forecourts.

TicketPro allows customers access to exclusive transport services, travel services, sporting events and entertainment.

BluAdvance provides qualified customers the opportunity to take out a prepaid electricity advance on their meter, with the ability to pay it back at a later stage.

Comm Equipment Company (CEC) is a business unit responsible for Cell C postpaid offerings.

T3 Telecoms SA (50% shareholding) is a mobile value-added services and product distribution company.

Blue Label Connect (BLC) distributes tailor-made hybrid top-up airtime and data contracts.

BluNOVA has become one of the leading practitioners of data and decision science in South Africa. They have deployed a state-of-the-art decision engine that supplies intelligent data leads and assists in securing new business.

Aligned Partnered Solutions (APS) (50% shareholding) provides operational and IT consulting services to Blue Label Connect.

Blue Label One is engaged in media advertising.

AltBureau is a data bureau based on API marketplace technology, serving as a platform to provide services to both external and internal clients.

The Prepaid Company (TPC): As the premier distributor of prepaid airtime and starter pcks for all the major South African network operators, TPC leverages trusted proprietary technology to ensure purchasing efficiency and robust inventory control.

GloCell Distribution: GloCell Distribution’s core strategy centres around the distribution of starter packs through its well-established channels.

Robtronics Service Solutions (51% shareholding): specialises in repairing mobile devices and managing the reverse logistics process to support the repair operations.

GloCell Retail Solutions (GCRS): is a distributor of prepaid products and value-added services for all major network operators. It supplies these offerings to various retailers, including national chains and petroleum forecourts.

Dunoworx (25.79% shareholding): provides mobile handset repair services to the Cell C customer base and sells and distributes second-hand mobile handsets.

SOLUTIONS

Blue Label Data Solutions (BLDS) (81% shareholding): is a market leader in consumer data, big data, validation and verification, data cleansing and lead creation.

Blu Train Group (64.57% shareholding): offers learnerships, training, recruitment and payroll services.

Blue Label Communications (50.3% shareholding): provides three business verticals: data, SMS and reverse data billing.

MOBILE NETWORK OPERATOR

Cell C Limited (Cell C) (49.53% shareholding): is a mobile operator in South Africa.

TECHNOLOGY AND DEVELOPMENT

Transaction Junction (60% shareholding):a business enablement platform offering tailored digital payment solutions for companies across a wide range of markets.

LIPA Payments (36% shareholding): is a payment software solution designed for banks and fintechs, enabling small merchants to process digital transactions through NFC and Bluetooth technology.

ELECTRICITY/MUNICIPALITIES

Cigicell (74% shareholding): collaborates with municipalities to enhance their revenue streams by offering prepaid electricity and water services.

ReWare provides smart meters that accurately track electricity usage, helping to monitor, verify and manage energy consumption.

Utilities World (25.1% shareholding): primarily focuses on designing prepayment revenue management software. In addition to this, the company handles the design, manufacturing and installation of prepaid electricity meters. Their systems have been utilised by local municipalities in South Africa and abroad for several years.

VISUAL Revenue Management (VRM) (74% shareholding): is a crucial partner and strategic player in South Africa's municipal sector, VRM is focused on revenue management, spatial data solutions and infrastructure development.

VENTURES

iCrypto (14.29% shareholding): enables organisations to eliminate cyber risks such as identity theft, access breaches, data breaches and ransom attacks, while enforcing compliance through technology‑leveraging biometrics and tokenised identity.

Mobii Systems Group (29.9% shareholding): specialises in game analytics and offers products powered by Internet of Things (IoT) technology.