Airtel Africa sees strong growth, but hit by forex challenges
Airtel Africa’s total customer base increased by 9.7% to 147.7 million, in the half-year period ending 30 September, as data use grew, and mobile money service penetration surged.
The telco, which has a presence in 14 African countries, said that the increase in its customer base resulted in a 23.0% increase in data users to 59.8 million and a 23.1% rise in mobile money clients to 36.5 million.
Mobile services revenue increased by 18.3%, in constant currency, driven by 11.5% rise in voice revenue and 28.1% growth in data revenue. In constant currency, mobile money revenue increased by 30.9%.
Income (measured in constant currency) increased by 19.7%, while reported currency revenue increased by 2.3% to $2,623 million.
EBITDA climbed by 21.2% (constant currency) and 3.7% (reported currency) to $1,302 million, with an EBITDA margin of 49.6%, despite inflationary cost pressures and foreign exchange headwinds, according to Airtel.
The after tax loss was $13 million, mostly due to a $471 million foreign exchange loss recorded in finance cost before tax, and $317 million after tax, due to the devaluation of the Nigerian naira in June 2023. "This impact has been classified as an exceptional item," Airtel noted in a statement.
Earnings per share (EPS) before exceptional items were 7.0 cents, a 3.2% increase.
It said: “EPS before exceptional items and excluding foreign exchange and derivative losses was 10.7 cents. Basic EPS at negative (1.5 cents) compared to 7.9 cents in the prior period, was impacted by $317m net exceptional loss on account of naira devaluation in June 2023.”
Olusegun Ogunsanya, Group chief executive officer, said the group reported a strong operating performance, despite foreign exchange headwinds in many of its markets, and specifically in Nigeria.
“The resilient growth in voice, data and mobile money usage levels reflects the inherent demand for these essential services across our footprint, and our six-pillar 'win-with' strategy continues to ensure we capture this growth opportunity by expanding our customer base and providing the platform to enable increased usage across the network,” he said.
“This strong momentum is supported by continued cost efficiencies, which enabled further EBITDA margin expansion.
“As reported in July 2023, our results for the first quarter were significantly impacted by the changes to the forex market in Nigeria, introduced by the Central Bank. While the changes are required for the long-term benefit of the Nigerian economy, the immediate impact of the naira devaluation continues to weigh on our reported financial performance in the period.”
He added: “Our focus remains to enhance long term value by continuing to drive sustained and efficient growth. Over the last five years we have delivered constant currency revenue and EBITDA compound annual growth of 17.1% and 20.7% respectively, allowing us to further de-risk the balance sheet and improve profitability across the group.”
Looking forward, Ogunsanya said, the delivery of affordable and reliable telecom and mobile money services across Airtel markets remains a key focus.