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Airtel Africa records higher revenues, client numbers

Friday November 06 2020
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Airtel Africa currently operates across 14 markets. PHOTO | FILE | NMG

By ANTHONY KITIMO

Airtel Africa has recorded improved revenue and customer base growth as African telecoms continue to leverage on their customer base to diversify on data, digital and financial services to remain afloat in the competitive business.

In its half year performance results, Airtel Africa announced customer base growing by 12 percent to 116.4 million subscribers out of the 412.9 million mobile subscribers combined of the top three telecom companies in Africa MTN Group, Orange and Airtel Africa which represents more than 53 percent of total network subscribers on the continent.

Covid-19 pandemic seems to be aiding growth of mobile money growth and data usage as different countries recommend cashless transactions and working from home strategy as a means to curb the spread of the virus.

As a result of the situation, Airtel Africa in the six months to September 30 saw mobile revenues increase 15.3 percent due to growth in voice and data, while its mobile money operation Airtel Money saw revenue growth of 30.4 percent.

UNPRECEDENTED TIMES

“The first half of our fiscal year included the peak impact of the Covid-19 pandemic in the countries where we operate.

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In these unprecedented times, the telecoms industry has emerged as a key and essential service for these economies, allowing customers to work remotely, reduce travel, keep them connected and allow access to affordable entertainment,” said Airtel Africa CEO Raghunath Mandava.

He added, “In these exceptional circumstances, in the first half, we delivered a strong set of results and as lockdown restrictions eased during Q2, our performance improved with constant currency revenue growth of 19.6 per cent, up 6.6 percent from the prior quarter.”

Mr Mandava, however, added that the company remains alert to the potential for further disruptions from a second wave of Covid-19 pandemic across Africa, and the associated actions of governments to minimise contagion.

Airtel Africa which currently operates across 14 markets, which span Eastern Africa, Francophone Africa and Nigeria, recorded a profit before tax of $0.5 million share of gain from joint ventures and associates compared to $0.4 million previous period.

The operator said profit after tax for the half year ended September 2020 is lower due to benefits in the same period of the prior year of exceptional items of $47 million, other finance costs had derivative gain of $46m in half year ended September 2019 and higher tax in half year ended September 2020.

Airtel Africa has announced its diversification plan in the continent to compete with the top two Africa telcos companies, MTN Group and Orange.

The company strategy rolled out in 2018 to grow its data services, digital services and mobile money operations seems to be delivering returns as the company records a 16.4 percent increase in revenue and a 19.6 percent increase with its customer base growing by 12 percent in the first half of its current financial year.

Its full swing plan to roll out 4G services across its various markets in eastern and Francophone Africa saw an increase of data revenue up by 33.4 per cent in the same period while other fronts such as voice and mobile money increased by seven percent and 30.4 percent respectively.

BROADBAND DEMAND

Airtel Africa was third after MTN and Orange to roll out 4G services and banked on the demand of the broadband during pandemic to increase its revenue on data.

In the past decade, African telecom firms have been both transformational and disruptive to their business models with increased broadband penetration and growing Internet adoption across key demographics.

Orange started the diversification move earlier than other telcos by adopting a multi-strategy approach that embraces voice and data bundling and strong growth in data infrastructure as telecom subscribers to adopt over-the-top services for communication needs.

In December 2019, Orange announced that it would reinforce its multi-services strategy so that they represent 20 per cent of turnover in the continent by 2025 while South Africa’s MTN is also serious with its diversification efforts.

For the past four years, the telco has been scaling its 3G/4G broadband across the continent in its plans to drive greater revenue and new growth with adoption of data and digital services.

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