Airtel's Covid bounce-back sees revenue jump 31%

29 July 2021 | Melanie Mingas

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Airtel Africa reported a revenue increase of 30.7% year on year in its second quarter results, reaching $1.1 billion, as the business recovered from the impacts of Covid-19 in 2020.

Strong revenue growth was recorded across all regions. In Nigeria revenue was up 38.2%; in East Africa 32.8%; and in Francophone Africa 24.9%.

Revenue growth was also recorded across key services, with voice up 26.0%, data up 37.4% and mobile money up 53.7%.

Even with adjustments for Covid, CEO Raghunath Mandava (pictured) said the results were ahead of Q4 2021 trends.

His statement read: "Q1 of last year was impacted by the start of Covid, but even after adjusting for these effects, our Q1’22 revenue growth rates for the group, service segments and reporting regions were all ahead of Q4’21 trends.

"Sub-Saharan Africa is now experiencing a third wave of the pandemic. Governments are implementing balanced measures of lockdowns and restrictions. But vaccinations levels remain very low. In these challenging times our business model has so far proven resilient, but we continue to monitor the situation closely for the potential impact on local economies and consumers."

Higher operating profits pushed profit after tax up 148.7%, to reach $142 million, Airtel said stable net finance costs also contributed, which more than offset the increase in tax charges due to increased profits.

Operating profit was $352m, up 67.6% in reported currency and 73.9% in constant currency.

Underlying EBITDA margin stands at 48.0% at the end of the quarter, an increase of 396 basis points – or 428 basis points in constant currency – and this was led by both revenue growth and improved operational efficiencies.

The customer base grew by 8.4% to reach 120.8 million customers, with increased penetration across mobile data, for which the customer base grew by 14.8%. For mobile money services the customer base increased by 24.6%.

However, Nigeria's new SIM card regulations weighed on this result – excluding the Nigeria market the customer base grew by 15.9%.

Mandava added: "Our total customer base has returned to growth with acceleration in our East Africa and Francophone regions and despite continuing negative net additions in Nigeria. With the easing of these restrictions in late April we have since been able to gradually increase locations for activations in line with regulatory compliance across Nigeria, and we have begun adding new customers.

"Our continued focus on modernisation and rollout of our network, along with simplifying our products and improving our distribution, have all helped us to make handsome gains on our ARPUs across voice, data and mobile money. Our robust operating model and solid execution should enable us to continue our profitable growth," he continued.

On future growth, Mandava concluded: "We continue to see huge potential across voice, data and mobile money due to the low penetration levels in Africa, as we continue to partner the nations in bridging the digital divide and enhancing financial inclusion. We remain committed to continue to efficiently and effectively deliver services that help to improve the lives, communities and economies we serve.”