Airtel Africa Reports $598m Profit

Airtel Africa Plc has posted a profit before tax of $598 million for the financial year ended March 31, 2020, an increase of 77.2 per cent on $348 million in 2019.

Profit after tax stood at $408 million from $426 million recorded in 2019.

According to the company, profit after tax was down by 4.4 per cent due to a one-off deferred tax recognition in Nigeria in the year ended 30 March 2019 and a lower exceptional item gain in the current period.

Post one-off tax benefit, profit after tax for the year increased by $43 million or 17 per cent.

Reported revenue grew by 11.2 per cent as 13.8 per cent constant currency growth was partially offset by currency devaluation.

The strong performance was largely driven by the growth of our customer base, up by 11.9 per cent to 110.6 million, as well as a 3.3 per cent growth in ARPU. Across the regions, Nigeria and East Africa continued to deliver strong performance, and performance in Francophone Africa continued to improve with revenue up 4.1 per cent in Q4 2020.

Revenue growth was broadly based across all key segments: voice up 5.2 per cent, data up 39.0 per cent and mobile money up 37.2 per cent in constant currency terms.

Raghunath Mandava, chief executive officer, Airtel Africa Plc, said the results were in line with aspirations set out at the time of the company’s initial public offering (IPO,) with performance sequentially improving during the year.

Revenue increased by 11.2 per cent, 13.8 per cent in constant currency, and underlying EBITDA by 13.8 per cent, 16.3 per cent in constant currency, to a reported $1,515m, underpinned by significant improvement in  free cash flow generation and reduced leverage.

“These results also demonstrate the strength and resilience of our business and the effectiveness of our strategy – with all three business services, voice, data and mobile money, contributing to revenue growth,” Mandava said..

He said the company has continued to invest in future growth opportunities as it expanded distribution, modernised and expanded its network with 65 per cent of sites now on 4G, acquired new spectrum in Nigeria, Tanzania, Malawi and Chad, and entered into strategic partnerships in its mobile money business.

“More recently, the markets where we operate have begun to be impacted by the COVID-19 and the related actions that governments have implemented to reduce the risk of contagion.

“Our priority has been to keep our colleagues, suppliers and customers safe whilst supporting the communities in which we operate,” Mandava said.

According to him, telecoms businesses provide strategically essential services to ensure the functioning of economies and communities and are, therefore, more resilient compared to some other sectors.

“In Africa, the spread of the COVID-19 has lagged the rest of the world and, therefore, it is difficult to precisely forecast what the impact of this will be on customers and business.

“However, our performance during the month of April has been resilient as the business continued to deliver constant currency revenue growth, although at a lower rate.

“We enter this period of increased volatility in a strong financial position and our view on the medium-term opportunities across our footprint has not changed, as these markets will continue to benefit from strong population growth and the need for increased connectivity and financial inclusion,” Mandava said.