Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

Business of Tech

Currency devaluations hit Airtel Africa earnings, despite user growth

Article Image
Pan-African operator Airtel Africa has seen its revenue dip 5.3% to $4.98 billion, hit by significant currency devaluations in Nigeria, Malawi, Zambia and Kenya, despite growing subscribers across the region over the past year.

That's according to the group's financial statements for the year ended March 31, 2024, which were published today.

The telecommunications firm, which operates in 14 African countries, said currency headwinds, particularly in Nigeria and Malawi, also contributed to an $89 million loss after tax, compared to a $750 million profit recorded the previous year.

"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," said Airtel Africa CEO Olusegun Ogunsanya, who is expected to retire next month.

"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," he added.

Group revenue – if currency had remained constant – would have seen growth of 20.9%, while group mobile services revenue grew by 19.4% in constant currency terms.

Voice revenue was up 11.9% and data revenues grew 29.2% in constant currency terms.

"In Nigeria, constant currency mobile services revenues increased by 25.8%, whilst East Africa saw 21.5% growth and Francophone Africa increased by 9.2%. Mobile money revenue grew by 32.8% in constant currency, primarily driven by continued strong growth in East Africa," the group said.

Data and mobile money subscribers grow

Despite profitability issues, the telecom company grew its overall customer base by 9% to reach 152.7 million.

That growth was spurred by a 17.8% increase in data customers, to 64.4 million, and a 20.8% increase in data usage per customer.

Mobile money subscribers grew by 20.7% during the financial year, which the company said reflected its "continued investment into distribution to drive increased financial inclusion across our markets."

Airtel Africa CEO Olusegun Ogunsanya will retire at the end of June 2024.   (Source: Airtel Africa)
Airtel Africa CEO Olusegun Ogunsanya will retire at the end of June 2024.
(Source: Airtel Africa)

The group's earnings before interest, taxes, depreciation and amortization (EBITDA) declined 5.7% to $2.4 billion in reported currency but the EBITDA margin "remained resilient" at 48.8% despite the currency headwinds and inflationary pressure on the cost base.

The EBITDA margin in the fourth quarter was 46.5%, impacted by the lower contribution of Nigeria following the naira devaluation and rising energy costs across several markets.

The group also reported a loss per share of 4.4 US cents for the financial year, compared to earnings per share of 17.7 US cents last year.

Airtel investment strategy

The group continued to scale up its network investment with 95% of its sites now 4G operational, facilitating a 42.3% increase in 4G customers over the year.

Capex for the year was broadly flat at $737 million and was below the group's guidance largely due to a deferral in data center investments.

In December 2023, Airtel Africa launched Nxtra by Airtel, its new data center business, and said it aims to build one of the largest networks of data centers in Africa with high-capacity data centers in major cities located strategically across Airtel Africa's footprint, complementing its existing edge sites.

In March 2024, it broke ground on its first data center in Lagos, Nigeria.

During the year, Airtel invested $152 million in license renewal and spectrum acquisitions, including $127 million for its Nigerian 3G license renewal.

The Board recommended a final dividend of 3.57 US cents per share, making the total dividend for the year 5.95 US cents per share.

In February 2024, the Airtel Board approved a share buyback program of up to $100 million, over a period of up to 12 months.

"The Board believes that repurchasing its own shares is an attractive use of its capital in light of the Group's strong long term growth outlook," the group said in its results announcement.

On March 1, 2024, Airtel announced the commencement of the first tranche of this buyback up to a maximum of $50 million. During March 2024, the company purchased 7.4 million shares for a total consideration of $9 million.

Follow Connecting Africa on our new X account @connect__africa to get the latest telecoms and tech news across Africa.

"The growth opportunity that exists across our markets remains compelling, and we 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," Ogunsanya added.

Related posts:

*Top image source: Agencja Fotograficzna Caro/Alamy Stock Photo.

— Paula Gilbert, Editor, Connecting Africa

Innovation hub


Orange Ventures, Digital Africa promise more funding for startups

Orange Ventures and Digital Africa are teaming up to invest more in tech startups in Africa and the Middle East through Digital Africa's Fuz program and the Orange Digital Center network.


Hot startup of the month: Rwanda's Ampersand

Connecting Africa's hot startup this month is Rwanda's Ampersand, which designs, builds, and manufactures electric motorcycles and battery packs for motorcycle taxis.

More Innovation hub

Latest video

More videos

Partner perspectives

All Partner Perspectives

Sponsored video

More videos

Follow us on X

Industry announcements

More Industry announcements

Upcoming events

Africa Tech Festival 2024
November 11-14, 2024
Cape Town, South Africa
More Upcoming events

Africa Tech Perspectives


Uber's Marjorie Saint-Lot on inclusion and sustainability in Africa

Uber's Country Manager for Ghana and Cote d'Ivoire, Marjorie Saint-Lot, shares how the ride-hailing company is approaching public-private partnerships, environmentally friendly initiatives and gender inclusion in Africa.


The 100 most influential African leaders in 2023

A new report from Africa Tech Festival and Connecting Africa puts a spotlight on the top 100 African leaders in the telecoms and technology sector in 2023.


Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

More Africa Tech perspectives

Guest Perspectives


Omdia View: April 2024

By Omdia Analysts

April 2024's telecoms highlights in the Middle East and Africa included a license for Starlink in Ghana, new mobile termination rates in Ethiopia, and 6G trials in Bahrain – that and more in the latest Omdia View.


Leveraging agritech to build resilience against climate change

By Francis Hook

ICT analyst Francis Hook discusses agritech in Africa and how the agricultural sector is using technology to build resilience against the negative effects of climate change and to ensure food security.

More Guest Perspectives

Like us on Facebook

Newsletter Sign Up

Sign Up
Tag id test-002