Photographer: Luis Tato/Bloomberg
Telecoms business Airtel Africa was the FTSE 100’s biggest faller on Thurday as it warned of slowing sales and currency-related strains.
At 112.2p per share the company — whose presence across 14 countries makes it Africa’s second-largest telecoms operator — was 4.9% lower in the session.
Airtel said that revenues rose 11.5% in the 12 months to March, to $5.3 billion. At constant currencies turnover increased 17.6%.
This was down from corresponding rises of 20.6% and 23.3% in the prior financial year.
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Airtel noted that “the slowdown in revenue growth from the previous year was due to a loss of tower sharing revenues following the sale of towers in Madagascar, Malawi and Tanzania in the second half of the year and [national identification number]-barring of voice services in Nigeria.”
Operating profit rose 14.5% year on year to $1.8 billion. At stable exchange rates it was up 20.1% year on year.
Exchange Rate Pressure
Airtel noted that “while each segment’s reported currency revenue growth was impacted by currency devaluation, they all delivered double-digit constant currency revenue growth.”
At its mobile services division revenues were up 9.9% on a reported basis, at $4.7 billion, while at unchanged exchange rates they increased 16.2%.
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The FTSE firm said that “revenue growth was recorded across all regions and key services,” led by Nigeria where sales jumped 20.3% year on year.
Total voice and data revenues increased 5.6% and 17.2% respectively during the last financial year, Airtel said.
Sales across the company’s mobile money business, meanwhile, increased 25.1% in reported currency, to $692 million, or 29.6% on a constant currency basis.
Airtel said that its total customer base rose 9% year on year to 140 million “as the penetration of mobile data and mobile money services continued to rise.”
A Challenging Environment
Airtel chief executive Olusegun Ogunsanya commented that “the operating environment has been challenging in many ways, yet our strategic focus on providing reliable, affordable and accessible services across our markets has enabled us to sustain our top-line growth momentum.”
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He said that “the resilience of our underlying EBITDA margins has shown the effectiveness of our operating model, despite significant inflationary and foreign exchange pressures.” Margins remained stable around 49% for financial 2023.
Ogunsanya added that “strong customer and ARPU growth over the year demonstrates that demand for our services remains very strong and gives us the confidence to continue investing to support our future growth potential.”
