Airtel Africa reported a net profit of $330 million for the half year ended September 2022, lower by 1.5 per cent due to higher foreign exchange and derivative losses of $160 million. Profit after tax excluding foreign exchange and derivative losses was up by 30.4 per cent.
Airtel Africa’s reported revenue for the quarter ended September 30, 2022, rose 12.7 per cent YoY and 12.9 per cent in the first half of fiscal year 2022. Average revenue per user (ARPU) grew 7.2 per cent in constant currency, largely driven by increased usage across voice, data and mobile money.
The telco’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by 14.3 per cent to $1,255 million in reported currency and by 17.8 per cent in constant currency, with an EBITDA margin of 48.9 per cent, an increase of 60 basis points in reported currency and 38 basis points in constant currency.
Earnings per share (EPS) before exceptional items was 6.8 cents, a reduction of 9.5 per cent largely as a result of higher foreign exchange and derivative losses of $160 million. Basic EPS increased to 7.9 cents (up by 3.7 per cent) as a result of deferred tax asset recognition in Kenya. The board has declared an interim dividend of 2.18 cents per share (2 cents in H1 FY2022).
In July 2022, the Group prepaid $450 million of outstanding external debt at HoldCo. The remaining debt at HoldCo is now $550 million, falling due in May 2024. The leverage ratio has fallen to 1.3 times from 1.5 times in the prior period.
Meanwhile, the telco’s capex increased by 26.9 per cent to $310 million, in line with its guidance, as it continues to invest for future growth. Additionally, it acquired spectrum in key markets including the Democratic Republic of the Congo and Kenya.
Airtel Africa’s total customer base increased to 134.7 million, up 9.7 per cent with increased penetration across mobile data (customer base up 10.6 per cent) and mobile money services (customer base up 24.0 per cent).
Commenting on the results, Segun Ogunsanya, chief executive officer, Airtel Africa, said, “Airtel Africa continued to deliver strong results as its purpose of transforming the lives of people across sub-Saharan Africa through digital and financial inclusion gained further momentum, with growth accelerating in the second quarter. Whilst we are not immune to the current macro-economic challenges and currency devaluation risks, I am pleased to report double-digit reported revenue growth in the period, largely driven by customer growth of 9.7 per cent and ARPU growth of 7.2 per cent, as we increased penetration and usage through our affordable service offerings. Our cost efficiency initiatives combined with improving growth trends have also helped offset inflationary pressures on our cost base and expand our EBITDA margin by 38 basis points in constant currency. We continue to de-risk our balance sheet and have further reduced HoldCo debt with the early repayment of $450 million of bond in July 2022. We continue to invest for growth and have increased capital expenditure by 27 per cent over the period, alongside a substantial investment into additional spectrum across several markets.Following the receipt of the Payment Service Bank and Super-Agent licence in Nigeria during the period, we have launched our mobile money operations. We are excited about the opportunity in our biggest market and will continue to build trust and confidence in the brand, whilst investing in distribution to increase access to financial services for underserved communities within the country. Today we have also published our inaugural sustainability report. The report provides a detailed review of our sustainability strategy that underpins our corporate purpose and sets out our achievements to date and our focus for the future. Overall these results continue to demonstrate the effectiveness of our strategy, sound execution, and the resilience of our business despite the uncertain macro-economic environment. For the remainder of the financial year, we anticipate sustained growth in the business, alongside EBITDA margin resilience.”
