Airtel Africa posted results for half the year ended 30 September 2024, which showcased solid growth despite currency devaluations and rising operational costs.
The company reported a 6.1% increase in its customer base, now totaling 156.6 million, driven by greater mobile data and mobile money adoption across the continent. Data consumption per user surged by 30.9%, reaching 6.6 GB monthly, while smartphone penetration grew by 5.3% to 42.9%. This growth underscores the strength of Airtel’s strategy to leverage Africa’s increasing digital adoption.
The telecoms revenue grew by 19.9% in constant currency, though it declined by 9.7% in reported currency due to currency devaluation impacts, especially in Nigeria. In Q2’25, Nigeria’s revenue growth accelerated to 38.2%, while Francophone Africa saw a steady 9% increase.
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Mobile services revenue increased by 18.4%, with mobile money revenue rising by 28.8% in constant currency. Profit after tax was $79 million, affected by $151 million in foreign exchange and derivative losses tied to naira depreciation. The constant currency mobile money revenue growth was driven by revenue growth in both East Africa and Francophone Africa of 31.4% and 20.2%, respectively.
In Nigeria, the company announced that it has continued to focus on customer acquisitions with 1.4 million active customers registered for mobile money services at the end of September 2024. Additionally, it reported the addition of almost 117,000 agents during the year reaching over 231,000 agents as of 30 September 2024.
Other Operational Highlights
Revenue and ARPU Increase: Data and mobile money ARPU rose by 13.5% and 10.9%, respectively, contributing to an overall ARPU growth of 11.1% year-over-year.
Network and Capacity Expansion: With c & 2,800 new sites and 3,500 kilometers of fiber added, Airtel increased data capacity by 20% across its networks, supporting customer demand
Revenue and ARPU Increase: Data and mobile money ARPU rose by 13.5% and 10.9%, respectively, contributing to an overall ARPU growth of 11.1% year-over-year.
Network and Capacity Expansion: With over 2,800 new sites and 3,500 kilometers of fiber added, Airtel increased data capacity by 20% across its networks, supporting customer demand and enhancing service reliability.
Regional Performance Highlights
1. Nigeria:
Constant currency revenue in Nigeria surged by 35.6%, despite a 44.3% decline in reported currency due to naira depreciation. Data usage grew by 44.4%, driven by an expanding customer base, while voice services increased by 23% in constant currency, demonstrating resilience despite regulatory challenges. A 90% rise in diesel prices and currency depreciation impacted profitability, but cost management initiatives are gradually offsetting these pressures.
2. East Africa:
Revenue in East Africa grew by 19.1% in constant currency, with strong growth in data (26.1%) and mobile money (31.4%). With smartphone penetration and 4G coverage reaching 98.8%, Airtel strengthened its mobile money hub in East Africa. Despite rising energy costs, margins improved in Q2, showing operational resilience.
3. Francophone Africa:
Revenue grew modestly by 5.3% in constant currency, led by data growth of 18.1%. Voice services faced challenges due to regulatory changes and price competition in markets like Congo B and Niger. Data volume increased by 41.8%, with smartphone usage averaging 6.2 GB per month. EBITDA margin declined due to higher energy costs and regulatory fees.
Financial Strategy and Capital Allocation
Debt Reduction and Currency Management: Airtel significantly reduced its foreign currency debt exposure by repaying $809 million. Currently, 89% of the company’s operating debt is in local currency, up from 71% last year.
Investment in Tower Infrastructure: Extending lease agreements for 7,100 sites across four markets, Airtel is focused on renewable energy investment to lower costs and improve cash flow.
Dividend and Share Buyback: An interim dividend of 2.6 cents per share was declared, a 9% increase. The ongoing $100 million share buyback program has acquired 61 million shares, totaling $88 million by the end of September.
Conclusion
Despite the challenges posed by currency devaluation, Airtel Africa’s half-year results reflect a resilient business model. The company’s focus on expanding mobile and financial services continues to pay dividends, with mobile money now contributing 19.6% of total revenue.
Airtel’s emphasis on cost efficiency and network investment positions it for continued growth, with East Africa leading mobile money adoption and Nigeria driving substantial data usage growth.