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Airtel Africa notes 6.9% revenue increase in Q2

Raghunath Mandava.jpg

A little over a year since its listing, Airtel Africa has continued its winning streak with a revenue increase of 6.9% in its latest financial results.

Taking the firm to US$851 million in revenue for the quarter ending 30 June – with constant currency revenue growth of 13% – the mobile operator noted growth across all segments: business services, voice, data and mobile money.

Over the last three months the mobile operator also noted a customer base increase of 11.8%, taking total subscribers to 111.5 million, while underlying EBITDA increased by 7.9% to $375 million with constant currency growth of 14.6%.

Although positive, CEO Raghunath Mandava (pictured) confirmed the results had been impacted by Covid-19, with growth fluctuations mirroring patterns in lockdowns and infection spikes. For example, after declines due to lockdown in April revenue growth accelerated in May, averaging 13% over the quarter.

Mandava, said: “In these unprecedented times, we have worked with governments, regulators, partners and suppliers to keep customers and businesses connected as well as supporting the economies and communities.

“We focused on expanding and maintaining our network to ensure it could cope with increasing demand, we kept our distribution up and running by increasing the penetration of digital recharges and stock levels, and we expanded our home broadband solutions to ensure customers could work and access entertainment remotely,” he added.

“Covid-19 impacted customer usage pattern, particularly during the month of April, however, as some of these restrictions started to be lifted, customer usage trends in May and June returned to being broadly consistent with pre Covid-19 trends,” Mandava continued, adding “all key business segments... and all regions - Nigeria, East Africa and Francophone Africa” contributed to the growth.

The results also echoed trends seen in Airtel Africa’s Q1 and FY 2019 results, when Airtel Money revenues “more than offset revenue declines in voice”.

The focus on mobile money remained a central part of the firm’s business strategy, unveiled before its June 2019 listing, which raised around £595 million. Today, Airtel Africa’s market cap stands at £2.5 billion.

During the Covid-19 pandemic Airtel Money also become a central pillar of the firm’s CSR activities.

Airtel Africa partnered with UNICEF to provide children with access to remote learning and enable access to mobile cash assistance for their families, and formed strategic partnerships with WorldRemit and Mukuru to enable customers from across the globe to receive money into Airtel Money wallets.

Over the last quarter the business also increased support to communities by providing free PPE for essential workers and free data for educational purposes, and worked with governments to temporarily waive fees on certain mobile money transactions.

Several further underlying reasons were stated for the positive performance, from “significant” 4G investments to the continent’s growing middle class.

However, on the outlook Mandava said: “The outlook remains uncertain, particularly regarding a so called potential second wave of infections and the actions governments will decide to take in that event. These results are further evidence of the growth opportunities our markets offer and the effectiveness of our strategy to focus on winning customers, investing in our network and expanding our voice, data and mobile money businesses.”

It’s almost a year since the firm signed up its 100 millionth customer, a feat itself achieved three months after the Company listed on 28 June 2019.

At the time, the subscription record made Airtel Africa the second largest mobile operator in Africa behind MTN (240 million subscribers). The latest financial results show the company is now “number one or two” in 14 countries, including Nigeria.

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