‘Facilitating revenue growth has been, and will remain, fundamental to Airtel Africa’s performance’

* This strong revenue performance is a reflection not only of the opportunity that is inherent across our markets

* But also the resilience of our affordable offerings despite the inflationary pressure many of our customers have experienced

By Duncan Mlanjira

In reflecting the financial accomplishment of Airtel Africa — whose total customer base grew by 9.0% to 152.7 million while mobile money subscriber growth at 20.7% — chief executive officer Olusegun Ogunsanya says facilitating revenue growth has been, and will remain, fundamental to Airtel Africa’s performance.

This is contained in Airtel Africa Plc statement of the results for year ended March 31, 2024, which highlights that the leading provider of telecommunications and mobile money services, with a presence in 14 countries in Africa, is delivering a resilient performance with strong underlying momentum — despite a volatile macro-economic environment.

Operating highlights, that include the customer base growth, Airtel Africa says is continues “to bridge the digital divide with a 17.8% increase in data customers to 64.4 million and a 20.8% increase in data usage per customer”.

“The mobile money subscriber growth of 20.7% reflects our continued investment into distribution to drive increased financial inclusion across our markets. Transaction value increase of 38.2% in constant currency with annual transaction value of over $112bn in reported currency. “Increased transactions across the ecosystem reflects the enhanced range of offerings and increased customer adoption, supporting constant currency ARPU growth of 8.6%.

“Continued network investment to support an enhanced customer experience and drive increased 4G coverage,” says the statement, adding that 95% of sites are now 4G operational, facilitating a 42.3% increase in 4G customers over the year.

On the financial performance, revenue in constant currency grew by 20.9% with growth accelerating to 23.1% in 4th quarter of 2024 (Q4’24) while Nigerian constant currency revenue growth accelerated to 34.2% in Q4’24 despite the challenging backdrop.

Reported currency revenues declined by 5.3% to US$4,979 million reflecting the impact of currency devaluation, particularly in Nigeria.

“Across the group, mobile services revenue grew by 19.4% in constant currency, driven by voice revenue growth of 11.9% and data revenue growth of 29.2%.

“Mobile money revenue grew by 32.8% in constant currency, with a continued strong performance in East Africa while EBITDA margins remained resilient at 48.8% despite the currency headwinds and inflationary pressure on our cost base.

“Constant currency EBITDA increased 21.3% with reported currency EBITDA declining 5.7% to US$2,428m. Q4’24 EBITDA margins of 46.5% were impacted by the lower contribution of Nigeria following the Q4’24 naira devaluation and rising energy costs across a number of markets.”

The company also reported a loss after tax was US$89 million, “primarily impacted by significant foreign exchange headwinds, resulting in a US$549m exceptional loss net of tax following the Nigerian naira devaluation in June 2023 and Q4’24, and the Malawian kwacha devaluation in November 2023”.

“Basic EPS of negative (4.4 cents) compares to 17.7 cents last year. EPS before exceptional items was 10.1 cents, a decline of 25.9%. Both EPS before exceptional items and basic EPS were primarily impacted by significant derivative and foreign exchange losses during the year.

“EPS before exceptional items and derivative and foreign exchange losses was 18.3 cents compared to 20.5 cents in the prior period.”

On capital allocation, Capex was broadly flat at US$737 million and was below Airtel’s guidance largely due to a deferral in data centre investments.

“In addition, we invested US$152 million in licence renewal and spectrum acquisitions, including US$127 million for the Nigerian 3G licence renewal.

“Leverage of 1.4x on 31 March 2024 was flat from the previous year. We have around US$680 million of cash available at HoldCo, to be utilized to fully repay the remaining US$550 million debt, falling due in May 2024.”

The company reports that its Board has approved a share buyback programme of up to US$100 million, over a period of up to 12 months and that on March 1, 2024, they announced the commencement of the first tranche of this buyback up to a maximum of US$50 million.

“During March 2024, the company purchased 7.4 million shares for a total consideration of US$9m. The Board has recommended a final dividend of 3.57 cents per share, making the total dividend for FY24 5.95 cents per share.”

Airtel Africa is also involved in sustainability strategy, that include its landmark five-year US$57m partnership with UNICEF launched across 13 markets providing access to educational resources, free of charge, “on our way to transforming the lives of over one million children through digital learning by 2027”.

“We partnered with the Government of Rwanda to launch the ConnectRwanda 2.0 initiative which aims to provide more than a million people with affordable smartphones to bridge the digital divide.”

Thus Ogunsanya, was compelled to declare that the consistent deployment of their ‘Win with’ strategy “supported the acceleration in constant currency revenue growth over the recent quarters, which has reduced the impact of currency headwinds faced across most of our markets”. 

“This strong revenue performance is a reflection not only of the opportunity that is inherent across our markets, but also the resilience of our affordable offerings despite the inflationary pressure many of our customers have experienced.

“Facilitating this growth has been, and will remain, fundamental to our performance. The investment in our distribution to catalyse growth, and the technology required to support this growth has been key. “Furthermore, our rigorous approach to de-risking our balance sheet and our capital allocation priorities has materially reduced the risks that the currency devaluation has had on our business.

“Key initiatives include the reduction of US dollar debt across the business and the accumulation of cash at the HoldCo level to fully cover the outstanding debt due. We will continue to focus on reducing our exposure to currency volatility.”

On the first buyback programme launched at the beginning of March, Ogunsanya says it reflects the strength of Airtel Africa’s financial position, emphasising that the growth opportunity that exists across its markets remains compelling — and they are well positioned to deliver against this opportunity.

“We will continue to focus on margin improvement from the recent level as we progress through the year. I want to say a particular thank-you to our customers, partners, governments and regulators for their support and our employees for their unrelenting contribution to the business.

“Our purpose of transforming lives across Africa will continue to be our highest priority,” said the chief executive officer.

With its presence in 14 countries in Africa, primarily in East, Central and West Africa, Airtel Africa offers an integrated suite of telecoms solutions to its subscribers, including mobile voice and data services as well as mobile money services, both nationally and internationally.

“We aim to continue providing a simple and intuitive customer experience through streamlined customer journeys,” says the statement.