Airtel Africa records $31m profit amid forex crisis

Airtel Africa Plc has reported a profit after tax of $31m for the quarter ended June 30, 2024, demonstrating resilience in the face of foreign exchange challenges.

Despite the Nigerian naira’s depreciation, which resulted in exceptional derivative and foreign exchange losses of $80m, net of tax, Airtel Africa’s strong fundamentals and strategic focus helped mitigate the impact.

“Profit after tax of $31m was impacted by $80m of exceptional derivative and foreign exchange losses (net of tax), arising from the further depreciation in the Nigerian naira during the quarter,” the report obtained by The According highlighted on Friday.

The telecom operator reported a 19 per cent growth in revenue in constant currency for the first quarter, driven by strong performances in Nigeria and East Africa.

Revenue in Nigeria grew by 33.4 per cent, while East Africa saw a 22.3 per cent increase.

However, revenues from Nigerian operations declined by 16.1 per cent to $1.16m due to currency devaluation.

Mobile services revenue grew by 17.4 per cent, while mobile money revenue was up 28.4 per cent.

Despite the revenue growth, Earnings Before Interest, Taxes, Depreciation, and Amortization margins declined to 45.3 per cent from 49.5 per cent in Q1’24 and 46.5 per cent in Q4’24, due to higher fuel prices and the lower contribution of Nigeria to the group after the naira devaluation.

The Chief Executive Officer of Airtel Africa, Sunil Taldar, said, “The continued revenue growth momentum once again reflects the resilient demand for our services, with sustained growth in our customer base and usage.

“Our superior execution enables us to capture these opportunities, whilst retaining our reputation as a cost leader across the industry.”

Taldar highlighted the company’s superior execution, cost leadership, and opportunities for growth in the enterprise, fibre, and data centre businesses across Africa.

He emphasised improving customer experience through simplified customer journeys and best-in-class network experiences.

The telco CEO also announced a comprehensive cost optimisation programme, which had yielded savings in network and distribution costs.

“We will build on the strong foundation established over many years to deliver on these new business opportunities. Most importantly, our emphasis is on significantly improving customer experience by simplifying customer journeys and providing best-in-class network experience to our customers, whilst remaining focused on driving efficiencies across the business.”