Airtel Africa’s profit falls 12.2% to $132 mn on high finance costs1 min read . Updated: 26 Jul 2019, 10:45 PM IST
- This is the company’s first financial results after it raised $750 million through its IPO last month
- Airtel Africa’s revenue rose 6.9% y-o-y to $796 mn, driven by double-digit growth in Nigeria and East Africa
New Delhi: Bharti Airtel’s Africa arm posted net profit of $132.2 million in the June quarter, a fall of 12.2% from the corresponding quarter of the previous year, as higher finance costs and lower gains on exceptional items offset its growth in operating profit.
These were the company’s first financial results since raising $750 million through its initial public offering (IPO) last month. The shares were then priced at 80 pence apiece, giving it a market capitalization of around $3.9 billion.
It posted revenue of $795.9 million, up 6.9% year-on-year from $744.5 million, largely driven by double-digit growth in Nigeria and East Africa, but partially offset by a decline in revenue in the rest of Africa, the company said.
The revenue increase is significant for the African arm of Bharti Airtel, which battles a bruising tariff war with rival Reliance Jio Infocomm Ltd at home.
Airtel Africa’s customer base stands at 99.7 million. Its average revenue per user (Arpu) was $2.7 in the June quarter.
“Voice revenue, our largest business product, was up 3% largely driven by 9% growth in our customer base, now reaching nearly 100 million customers across our footprint. Data revenue, our largest contributor to growth, was up 36%, as an increasing number of customers relied on our high-quality and high-speed LTE network, resulting in 79% growth in data usage. Mobile money revenue, our fastest growing business, increased by 42%, as we expanded our distribution reach," Raghunath Mandava, chief executive officer, Airtel Africa, said in a statement.
Bharti Airtel will declare its June quarter earnings for India operations on 1 August. Africa has proved to be a beacon of hope for the company, which is faced with a struggling India business.
Airtel Africa is the holding firm for Bharti Airtel’s operations in 14 countries, with Nigeria alone accounting for almost half of its earnings before interest, taxes, depreciation and amortization (Ebitda).
Airtel Africa’s Ebitda rose 9.7% year-on-year from $316.9 million in the year-ago period to $347.6 million in the June quarter.
Revenue from data services grew from $156.6 million a year ago to $207.1 million in the quarter, while voice revenue was flat at $469.9 million.