Airtel Africa, a subsidiary of Bharti Airtel operating in 14 African countries, reported a profit of USD 115 million for the quarter ending in September 2023. This marked a 13.53 percent decline from the USD 133 million earned in the same quarter the previous year. The company also revealed a 4.7 percent year-on-year decrease in revenue for the quarter, with earnings totalling USD 1,246 million, down from USD 1,308 million in the previous year.
Strong Customer Growth
Airtel Africa reported robust growth in key performance indicators (KPIs) for the first half of the year, with a 9.7 percent increase in the total customer base, reaching 147.7 million. Data customers grew by 23.0 percent, reaching 59.8 million, and mobile money customers increased by 23.1 percent to 36.5 million. The mobile money transaction value experienced a 45.3 percent growth in constant currency, with a Q2'24 annualised transaction value of USD 116 billion in reported currency.
Revenue and EBITDA Performance
In terms of revenue, the company reported a 19.7 percent growth in constant currency, with reported currency revenues slightly increasing by 2.3 percent to USD 2,623 million. However, in Q2'24, reported currency revenues saw a 4.7 percent decline, reflecting the full-quarter impact of the Nigerian naira devaluation in June 2023. Q2'24 constant currency revenues increased by 19.0 percent.
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased by 21.2 percent in constant currency and 3.7 percent in reported currency, reaching USD 1,302 million, with an EBITDA margin of 49.6 percent. This margin reflected a 70bps margin improvement over the previous period, despite inflationary cost pressures and foreign exchange headwinds. Reported currency EBITDA declined by 3.3 percent in Q2'24 due to the full impact of the Nigerian naira devaluation in June 2023.
CEO's outlook and challenges
Olusegun Ogunsanya, Group Chief Executive Officer, expressed his satisfaction with the Group's strong operating performance, emphasizing the resilience of their voice, data, and mobile money services, which continue to experience significant growth. The company's six-pillar 'win-with' strategy focuses on expanding the customer base and facilitating increased usage across the network.
Ogunsanya also acknowledged the challenges posed by changes to the FX market in Nigeria, particularly the naira devaluation. Despite these challenges and rising diesel prices in Nigeria, Airtel Africa aims to limit their impact through operational leverage and cost efficiencies, ultimately working toward an improved EBITDA margin in FY'24 compared to FY'23.