Two of Malawi’s largest telecommunications services providers, Telekom Networks Malawi (TNM) and Airtel Malawi, have projected subdued results for half-year ended 30 June 2022, with the devaluation of the Kwacha cited as a main contributing factor.

According to statements released independently by each company, both stated an expectation that profit after tax will be lower year-on-year due to foreign exchange loss resulting from the recent 25% devaluation of the local currency, the Kwacha.

Christina Mwansa, TNM company secretary said, “The company accordingly advises that profit after tax for the half year ending June 30, 2022 is expected to be approximately 13% lower than the previous corresponding period.”

The company moved to reassure its market and said it will implement strategies that will spur revenue growth.

Airtel Malawi said although the information on which the trading statement is based has not yet been reviewed by auditors, it expects profit after tax to drop between 20% and 25%.

Company secretary Hlupekire Chalamba said, “In accordance with the listing requirement of the Malawi Stock Exchange Limited, a listed company is required to publish a trading statement as soon as there is a reasonable degree of certainty that the financial results for the period to be reported upon next will differ by at least 20% from the financial results of the previous corresponding period. Airtel Malawi accordingly advises that the company’s profit after tax for the half year ending June 30, 2022 is expected to be approximately 20% to 25% less than the profit reported in the corresponding previous period. The adverse deviation has arisen from foreign exchange loss suffered from the recent Malawi Kwacha devaluation.”

The local currency was devalued in May this year as part of the government’s attempt to ensure that a new International Monetary Fund (IMF) Extended Credit Facility (ECF) programme is in place to help the country navigate through tough economic conditions.

At the time, the Reserve Bank of Malawi (RBM) said the move was aimed at realigning the value of the local currency to market trends and ascertain the currency’s true value.