Currency headwinds take Airtel Africa to $89 million loss despite significant revenue growth

Dar es Salaam. Airtel Africa posted a loss after tax of $89 million despite growth of revenue in the last financial year as currency headwinds across the continent affected the performance.

According to the results for the year ending March 31, 2024, the company’s revenue grew by 20.9 percent but the volatility in the macro-economic environment caused the negative impact.

The loss is primarily influenced by significant foreign exchange headwinds, resulting in a $549 million exceptional loss net of tax following the Nigerian naira devaluation in June 2023 and early 2024, and the Malawian kwacha devaluation in November 2023, the company said in a statement.

“The consistent deployment of our ‘Win with’ strategy supported the acceleration in constant currency revenue growth over the recent quarters which has reduced the impact of currency headwinds faced across most of our markets,” said Airtel Africa chief executive officer, Mr Olusegun Ogunsanya.

“The strong revenue performance is a reflection not only of the opportunity that is inherent across our markets, but also the resilience of our affordable offerings despite the inflationary pressure many of our customers have experienced,” he said, adding that facilitating the growth will remain fundamental to the company’s performance.

The company’s total customer base grew by 9.0 percent to 152.7 million during the year as data customers increased by 17.8 percent to 64.4 million and a 20.8 percent increase in data usage per customer.

Across the group mobile services revenue grew by 19.4 percent in constant currency, driven by voice revenue growth of 11.9 percent and data revenue growth of 29.2 percent. Mobile Money revenue grew by 32.8 percent in constant currency, with a continued strong performance in East Africa, the company said.

Mr Ogunsanya said the company’s rigorous approach to de-risking its balance sheet and capital allocation priorities reduced the risks that the currency devaluation has had on Airtel Africa business.

According to him, key initiatives include the reduction of US dollar debt across the business.

“We will continue to focus on reducing our exposure to currency volatility,” he said.

At the beginning of March, Airtel also launched its first buyback after the board approved a share buyback programme of up to $100 million, over a period of up to 12 months.

On March 1, 2024, Mr Ogusanya said, the company announced the commencement of the first tranche of this buyback up to a maximum of $50 million.

During March 2024, the company purchased 7.4 million shares for a total consideration of $9 million.

“The growth opportunity that exists across our markets remains compelling, and we are well positioned to deliver against this opportunity. We will continue to focus on margin improvement from the recent level as we progress through the year,” he said.