Airtel Africa’s profit plunges almost 100% amid naira devaluation pressures
Telecom powerhouse Airtel Africa was only a breath away from loss-making in the nine months to December after net profit crashed by 99.6 per cent.
A free fall in the value of the naira in Nigeria, its biggest market for mobile service, battered earnings, according to details of its unaudited financials Thursday.
Multinationals in Nigeria are grappling with the hard times created by the downside of a raft of foreign exchange reforms introduced shortly after President Bola Tinubu took office last May.
The move set the local currency on a sharp slide of 45.4 per cent during the year, forcing multinationals like GlaxoSmithKline to close shop.
Airtel Africa is the continent’s unit of New Delhi-based Bharti Airtel, the business empire of the world’s 105th richest person according to Bloomberg’s Billionaire Ranking Sunil Mittal.
The revenue of the wireless operator, which operates in 14 markets in Africa, took a 1.4 per cent dive to $3.9 billion from one year ago.
Operating profit slipped 1.9 per cent to $1.3 billion.
Airtel Africa incurred $484 million from derivative and foreign exchange losses following a naira devaluation in June and a devaluation of the Malawian Kwacha in November, the company said in its earnings report.
READ ALSO: CBN debunks reports of naira devaluation
Profit before tax stood at $55 million compared to the $801 million reported for the same period one year ago. Profit after tax fell to $2 million from $523 million.
“Demand remains resilient, highlighting the vital nature of the voice, data and mobile money services we provide to our customers across the region, and has resulted in a strong 20.2% constant currency revenue growth over the period, with an increase in EBITDA margins,” CEO Olusegun Ogunsanya said in a separate document.
“Whilst further currency devaluation, particularly in Nigeria, has weighed on our reported financial performance, it will not affect the execution of our growth plans.”
Airtel Africa said it would launch a share buyback beginning this March over 12 months to repurchase shares worth $100 million.
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Telecom powerhouse Airtel Africa was only a breath away from loss-making in the nine months to December after net profit crashed by 99.6 per cent.
A free fall in the value of the naira in Nigeria, its biggest market for mobile service, battered earnings, according to details of its unaudited financials Thursday.
Multinationals in Nigeria are grappling with the hard times created by the downside of a raft of foreign exchange reforms introduced shortly after President Bola Tinubu took office last May.
The move set the local currency on a sharp slide of 45.4 per cent during the year, forcing multinationals like GlaxoSmithKline to close shop.
Airtel Africa is the continent’s unit of New Delhi-based Bharti Airtel, the business empire of the world’s 105th richest person according to Bloomberg’s Billionaire Ranking Sunil Mittal.
The revenue of the wireless operator, which operates in 14 markets in Africa, took a 1.4 per cent dive to $3.9 billion from one year ago.
Operating profit slipped 1.9 per cent to $1.3 billion.
Airtel Africa incurred $484 million from derivative and foreign exchange losses following a naira devaluation in June and a devaluation of the Malawian Kwacha in November, the company said in its earnings report.
READ ALSO: CBN debunks reports of naira devaluation
Profit before tax stood at $55 million compared to the $801 million reported for the same period one year ago. Profit after tax fell to $2 million from $523 million.
“Demand remains resilient, highlighting the vital nature of the voice, data and mobile money services we provide to our customers across the region, and has resulted in a strong 20.2% constant currency revenue growth over the period, with an increase in EBITDA margins,” CEO Olusegun Ogunsanya said in a separate document.
“Whilst further currency devaluation, particularly in Nigeria, has weighed on our reported financial performance, it will not affect the execution of our growth plans.”
Airtel Africa said it would launch a share buyback beginning this March over 12 months to repurchase shares worth $100 million.
Support PREMIUM TIMES’ journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
Donate
TEXT AD: Call Willie – +2348098788999
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