Bharti Airtel’s Africa profit rises to $92m

Airtel’s Africa units recorded a $92 million profit before tax in the three months to March, a 9.5 per cent increase from $84 million in the same period last year.

In its financial results released on Tuesday, the Indian telecommunications giant said there was a 10 per cent customer growth leading to revenues rising 11.7 per cent to $287 million.

“The earnings before tax for East Africa for the quarter were $120 million, as compared with $93 million in the corresponding quarter last year,” Bharti Airtel said.

The firm pumped in more than $258 million into its East African units, primarily for expenditure on network expansion, while its operating free cash flow for the period was $203 million, compared with $244 million in the previous year.

East Africa incurred a capital expenditure of $119 million, primarily on network expansion. Its operating cash flow for the quarter was $1 million compared with a negative operating position of the same amount in the same quarter last year.

Airtel’s East Africa units are Uganda, Rwanda, Kenya, Tanzania, Malawi and Zambia.

In these countries, the telecommunications firm saw its customer base rise to 42.8 million in the three months to March 2019, from 38.9 million in the same quarter in 2017, reflecting a growth of 10 per cent.

“The customer churn for the year was 4.8 per cent as compared to four per cent in the previous year. The increase in churn is largely contributed by customer disconnections related to stringent ‘Know Your Customer’ regulations,” the firm said.

Airtel’s voice revenue for the period rose to $151 million, growing by 7.3 per cent as compared to $140 million in the same quarter last year: Talk time growth rose 21.2 per cent to 30.2 billion.

The regional units’ data revenue stood at $70 million, a 13.6 per cent growth as compared with $62 million in the same quarter last year, mainly driven by data customer growth of 8.4 per cent to 10.9 million, from 10.1 million.

The total network towers in East Africa were 8,449 at the end of the quarter, up from 8,126 in the same quarter last year.

The number of mobile broadband base stations increased to 15,551 from 10,419 last year, the firm said.

In its wider African operations, the firm posted a net profit of $83 million in the March quarter, up from a loss of $49 million a year earlier.

As at the end of March, Airtel Africa had a customer base of 98.9 million, up from 89.3 million the previous year, an increase of 10.7 per cent.

Its total minutes-on-network during the year grew 30 per cent to 207.3 billion, from 159.5 billion over the same period in 2018.

“Data customers increased by 5.1 million to 30 million, and they now represent 30.4 per cent of the total customer base. The total MBs on the network grew by 65.3 per cent to 392.6 billion MBs,” the firm said.

The total customer base using the Airtel Money platform increased by 24 per cent to 14.2 million, from 11.5 million in the previous year, while the total value of transactions on the Airtel money platform increased 30.5 per cent to $26.2 billion, up from $20 billion.

Money revenue rose to $243.3 million from $152.4 million in the previous year, reflecting a growth of 59.7 per cent.

Africa revenues grew by 11.6 per cent to $3.12 billion, from $2.8 billion in the previous year, with the operational expenditure for the telco on the continent growing to $1.16 billion from 41.1 billion in the previous year.

“The capital expenditure during the year was $630 million for African operations, largely on account of investment in data capacity and network modernisation. Operating free cash flow during the year stood at $735 million, as compared with $697 million in the previous year,” the firm said in the financial statement.