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Airtel Africa Plc reported a net profit of $31 million for the first quarter of fiscal year 2024, a significant turnaround from a loss of $151 million in the same period last year. The previous year’s loss was primarily due to a sharp rise in finance costs.
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Despite this profitability, the telecom company faced challenges with revenue and operating profit. Quarterly revenue decreased by 16% year-on-year to $1,156 million, largely due to the currency devaluation in Nigeria. In constant currency terms, however, revenue grew by 19% to $1,172 million. Operating profit also declined by 27% to $335 million in the first quarter.
The company’s average revenue per user (ARPU) increased by 9.3% year over year, driven by a 9.6% growth in data ARPU and an 8.8% increase in mobile money ARPU in constant currency terms.
Airtel Africa’s Ebitda margin declined to 45.3% from 49.5% in the same period last year, impacted by increased fuel prices and the devaluation of the Nigerian naira. In constant currency terms, Ebitda increased by 11.3%, while in reported currency terms, it declined by 23.3% to $523 million. Profit after tax was affected by an $80 million exceptional derivative and foreign exchange loss, net of tax, due to further naira depreciation.
The company’s basic earnings per share (EPS) rose to 0.2 cents, compared to a negative 4.5 cents in the prior period, reflecting a significant reduction in exceptional derivative and foreign exchange losses.
Operating Highlights:
- Total customer base grew by 8.6% to 155.4 million.
- Mobile money subscriber growth of 14.9%.
- Data capacity increased by 33% with the addition of nearly 3,000 new sites and over 5,600 km of fiber.
Capital Allocation: Capital expenditure (capex) was $147 million, a 4.9% increase compared to the prior period, with full-year capex guidance between $725 million and $750 million. The company’s leverage stood at 1.6 times as of June 30, 2024, up from 1.3 times last year, partially due to a decrease in reported currency Ebitda.
The company has continued its $100 million share buyback program, purchasing 21 million shares for $29 million by the end of June 2024. Airtel Africa also reported zero holding company debt following the repayment of a $550 million bond in May 2024, funded exclusively from cash reserves. This repayment aligns with the company’s strategy to reduce external foreign currency debt.
