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Malawi: Airtel will invest despite volatile Kwacha

By , Sub Saharan Africa Business, Tech, News and Development Journalist
Malawi , 12 Sep 2022

Airtel said it will continue to invest in its Malawian mobile phone unit despite currency weakness in the southern African country.

In the half-year period to end June, costs for Airtel Malawi increased by 199% as a result of 25% devaluation in the Malawian Kwacha. After-tax profits declined by 21.5%, which the company attributed to a worsening foreign exchange position as a direct result of devaluation.

A statement released by the company on Friday reads: “The economy and company is exposed to continued impact of Kwacha depreciation and scarcity of foreign currency. Despite this we continue to focus on investing more, growing more customers and revenue, containing cost and diversifying currency sourcing to mitigate the exposures.”

Despite these challenges, Airtel Malawi has grown its customer base by 11.1% to 6.4 million subscribers.

Revenue in local currency terms was stronger by 14.3%, boosted by a 20% firming in voice revenue and a further 5% quickening in data revenue.

During the period the company repaid a principal debt amount of US$7-million out of its US$40 -million loan. This means that it has a total principal amount outstanding of US$33-million as at the end of the period under review.

Press Corporation said this month it had registered a 168% decrease in profit after tax from its telecommunications operations -TNM and fixed phone operator MTL - during the same half-year period to end June.

It said the losses were exacerbated by the devaluation of the local currency, resulting in exchange losses.

“The Group is confident that the segment will soon benefit from fresh strategies currently being implemented that seek to arrest the losses and reverse the segment’s performance. The search for equity investors in the fixed telephony business is continuing,” the company stated.

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