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Nigeria’s 32.4% revenue growth boosts Airtel Africa’s operations

By Adeyemi Adepetun
29 October 2021   |   4:03 am
Airtel's Nigerian operations added 32.4 per cent revenue growth to the cumulative earnings of the telecommunications firm in the first half of the year ended September 2021.

•Combined subscribers base impacted by NIN-SIM directive in Nigeria
Airtel’s Nigerian operations added 32.4 per cent revenue growth to the cumulative earnings of the telecommunications firm in the first half of the year ended September 2021.

According to the financials released yesterday, Airtel Africa revenue grew by 25.2 per cent to $2,272 million with double digit growth across all regions.

The report showed that the revenue in constant currency grew by 27.6 per cent.

Specifically, the report showed that there was strong double-digit constant currency revenue growth across all regions: Nigeria up 32.4 per cent, East Africa up 25.8 per cent and Francophone Africa up 22.1 per cent; and across all key services, Voice up 19.7 per cent, Data up 36.9 per cent and Mobile Money up 42.0 per cent.

The firm said its underlying EBITDA grew by 35.2 per cent to $1,098 million in reported currency and underlying EBITDA margin improved to 48.3 per cent, an increase of 360 basis points led by both revenue growth and improved operational efficiencies.

While the report revealed that operating profit was up 55.1 per cent to $732 million in reported currency, Profit After Tax more than doubled to $335 million, largely due to higher profit before tax which more than offset the associated increase in tax charges.

According to the firm, the basic EPS was 7.6 cents, an increase of 155.9 per cent, as a result of higher profit. EPS before exceptional items increased to 7.5 cents from 3.0 cents in previous period.

The firm’s leverage ratio reduced to 1.5x from 2.2x, while customer base grew by 5.4 per cent to 122.7 million, with increased penetration across mobile data (customer base up 10.9 per cent) and mobile money services (customer base up 19.0 per cent).

Airtel Africa revealed that its customer base growth was affected by the new NIN/SIM registration regulations in Nigeria, stressing that excluding Nigeria, the customer base grew by 13.7 per cent.

Going by the result, the board has declared an interim dividend of two cents per share (1.5 cents in H1’21) in line with an upgraded dividend policy.

The firm said the new policy aims to grow the dividend yearly by a mid to high-single digit percentage from a new base of five cents per share for FY 2022, with a continued focus to further strengthen the balance sheet.

Chief Executive Officer, Segun Ogunsanya, on the trading update, said: “Our first half financial performance has been strong. The first half of last year, especially Q1, was impacted by the start of Covid-19, but even after adjusting for these effects, our revenue growth rates for the half year for the Group and all our service segments are ahead of our FY’21 revenue growth trends, and in reported terms these are all in strong double digits.”

Ogunsanya said the risks from Covid still remain, with sub-Saharan Africa continuing to experience a third wave of the pandemic.

He said governments continue to implement balanced measures of lockdowns and restrictions accordingly.

Ogunsanya said vaccination levels remain low, and “we continue to monitor the situation for potential impacts on economies and consumers.

Accordingly, the firm has continued its network modernisation and expansion, aligned with an extension of distribution capabilities, which have together contributed towards continued strong growth in ARPUs across voice, data and mobile money.

“We have seen an improvement in our customer growth trends for the Group as we approach stability of net monthly movements in Nigeria.

“Alongside our results we have today launched our sustainability strategy. Airtel Africa has always been a business with a sustainable premise at the heart of our purpose to transform lives across Africa through our promotion of both digital and financial inclusion.

“Our sustainability strategy builds upon this, extending and more comprehensively articulating our sustainability goals and credentials. I am excited by the new initiatives we have launched and I look forward to reporting back on our developments in this area with our first sustainability report next year.

“As incoming Group CEO, I have inherited the responsibility to build upon a business with solid foundations and as I look ahead, I continue to see huge potential across voice, data and mobile money from low penetration levels across Africa. The continent continues to be a growth story for us despite the pandemic. We will continue to invest in mobile and digital technologies to drive digital and financial inclusion sustainably in Africa. I am pleased with the progress we have made in the last couple of years on delivering value to everyone touched by our network.”

According to him, Airtel Africa Plc results for half year ended September 30, 2021 are unaudited and in the opinion of management, include all adjustments necessary for the fair presentation of the results of the same period.

He said the financial information has been prepared based on International Accounting Standard 34 (IAS 34) issued by the International Accounting Standards Board (IASB) approved for use in the UK by the UK Accounting Standards Endorsement Board (UKEB) and apply the same accounting policies, presentation and methods of calculation as those followed in the preparation of the Group’s annual consolidated financial statements for the year ended March 31, 2021 except to the extent required/ prescribed by IAS 34.