in

Airtel Records $1.7 Billion Loss Over Currency Devaluations

Airtel Africa, Nigeria’s second largest telecommunications firm spanning across 14 African nations, has unveiled its financial results for the fiscal year ending March 31, 2024, revealing a 5.3% dip in revenue to $4.9 billion and a corresponding 5.7% decrease in EBITDA. This downturn has been attributed to notable currency devaluations in key markets like Nigeria, Malawi, Zambia, and Kenya, which, in turn, resulted in a substantial $1.7 billion loss primarily from derivative and foreign exchange activities.

The impact of these currency fluctuations reverberated throughout the company’s financials, manifesting in an $89 million loss after tax, marking a drastic 111.9% drop from the $750 million profit reported in the previous fiscal year. The pronounced devaluation of the Nigerian naira and the Malawian kwacha against the US dollar significantly contributed to these adverse outcomes.

However, amidst the profitability challenges, Airtel Africa managed to expand its customer base by a commendable 9%, reaching a total of 152.7 million subscribers. This growth trajectory is particularly impressive considering the prevailing macroeconomic obstacles that dampened profitability for the majority of the fiscal year.

Recognizing the detrimental effects of currency volatility on its operations across the continent, Airtel Africa has made concerted efforts to mitigate such risks. One notable initiative includes actively reducing its exposure to US dollar-denominated debt while concurrently bolstering cash reserves at the holding company level to address outstanding obligations.

Despite the financial setbacks, the telecom behemoth remains optimistic about the growth prospects across its markets. Olusegun Ogunsanya, Airtel’s CEO, emphasized the company’s resilient financial position and its unwavering commitment to capitalizing on the prevailing growth opportunities. With Ogunsanya set to retire the following month, the company is poised to navigate the evolving landscape under new leadership.

  • ATTENTION: Techrectory gives ₦5,000 monthly to our top readers, CLICK HERE to become a winner.

Looking beyond the challenges, Airtel Africa’s financial statement also underscored notable growth metrics. The group witnessed a robust 19.4% increase in mobile services revenue, driven by double-digit growth in both voice and data segments. Furthermore, mobile money revenue surged by 32.8% in constant currency, buoyed by stellar performances in East Africa and Francophone Africa.

In tandem with the expansion in revenue streams, Airtel Africa experienced significant growth in its customer base, particularly in data and mobile money services. The penetration of these offerings continued to rise, resulting in a 20.7% increase in mobile money customers, totaling 38 million, and a corresponding rise in data customers to 64.4 million.

In conclusion, while Airtel Africa grappled with formidable challenges stemming from currency devaluations, its resilience, strategic initiatives, and relentless focus on customer-centric growth have positioned it favorably to capitalize on emerging opportunities across the African telecommunications landscape.

Techrectory with Agency Report.

Techrectory on Google News

ADVERTISMENT

See also NCC's Vigilance: Unapproved Phone Sales Alert

Leave a Reply

Your email address will not be published. Required fields are marked *

What do you think?

Written by News Desk

Your daily pulse on mind-blowing tech, business, and economy news. Stay informed, stay ahead!

Alerzo Reduces Staff for The Fourth Time

Court Grants Sirika, Daughter, In Law Bail In N2.7bn Fraud Case