Airtel Africa profit up 13% in Q4, Arpu flat at $3.2

Bharti Airtel-owned Airtel Africa’s net profit attributable to owners rose 13.4% q-o-q to $195 million in the January-March quarter owing to recognition of deferred tax credit from some markets and other tax-related adjustments.

Revenue from operations fell 0.6% q-o-q to $1.34 billion in Q4FY23 due to a fall in voice and mobile money revenues. On a y-o-y basis, revenues grew 18.6% in constant currency terms and profit rose 2.8%.

The slowdown in revenue growth from the previous year was due to a loss of tower sharing revenues following the sale of towers in Madagascar, Malawi and Tanzania in the second half of the year and national identification-related barring of voice services in Nigeria, the company said.

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During the quarter, Airtel Africa added 1.5 million subscribers, taking its total base to 140 million and its average revenue per user (Arpu) was flat at $3.2. “Over the last year, the operating environment has been challenging in many ways, yet our strategic focus on providing reliable, affordable and accessible services across our markets have enabled us to sustain our topline growth momentum,” CEO Olusegun Ogunsanya said.

“Strong customer and Arpu growth over the year demonstrate that demand for our services remains very strong and gives us the confidence to continue investing to support our future growth potential,” Ogunsanya said.

Rrevenue from the voice business fell over 4% q-o-q to $619 million, whereas its data revenue rose 3.3% q-o-q to $469 million. The mobile money business fell 3.8% q-o-q to $176 million.

In Q4, Airtel Africa’s Ebitda margins rose marginally to 49.1%. On a y-o-y basis, the margins contracted 63 basis points from 49.7% owing to an 82.4% y-o-y increase in finance cost. “The resilience of our underlying Ebitda margins has shown the effectiveness of our operating model, despite significant inflationary and foreign exchange pressures,” Ogunsanya said.

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As of March end, the company’s net debt was at $3.52 billion, a fall of 3% from the preceding quarter. “Over the year, we invested $500m on additional spectrum, including 5G, across many of our OpCos (operating companies) which, combined with our capex, will underpin our growth ambitions. Despite this investment, and driven by a disciplined capital allocation policy, our balance sheet remains strong and has been further de-risked over the last year by the prepayment of $450m HoldCo (holding company) debt in July last year,” he added.

The remaining debt at HoldCo is now $550m, falling due in May 2024, the company added.