Airtel Africa Records USD 91 Million Loss Amid Tax and Forex Challenges

Bharti Airtel's Africa unit, Airtel Africa, has reported a significant shift in its financial performance for the fourth quarter ended March 2024, revealing a loss of USD 91 million (approximately Rs 760 crore). This downturn is attributed to a combination of tax impacts and foreign exchange losses. This marks a stark contrast from the same period in the previous year, where the company enjoyed a consolidated profit of USD 227 million.

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The company, which boasts operations across 14 African countries, saw its consolidated revenue decrease by 16.6% to USD 1,118 million in the reported quarter, down from USD 1,341 million in the March 2023 quarter. Despite this decline, revenue experienced a 23.1% increase on a constant currency basis.

Over the entire fiscal year ending March 31, 2024, Airtel Africa encountered a loss of USD 89 million, diverging from the USD 750 million profit recorded in the previous year. The annual loss was significantly influenced by a net tax impact of USD 549 million from exceptional derivative and foreign exchange losses. However, excluding these exceptional items, the profit after tax for the year stood at USD 460 million.

The annual revenue also saw a decrease of 5.3% to USD 4,979 million during the reported fiscal year from USD 5,255 million in the fiscal year 2022-23. Nevertheless, on a constant currency basis, there was a notable increase of 20.9% in annual revenue.

Airtel Africa's CEO, Olusegun Ogunsanya, commented on the financial outcomes, highlighting the company's strategic approach dubbed 'Win with strategy'. This approach has been instrumental in mitigating currency headwinds and fostering revenue growth amidst inflationary pressures affecting customers.

At the group level, mobile services revenue saw an upsurge of 19.4% in constant currency terms. This growth was propelled by an increase in voice revenue by 11.9% and data revenue by an impressive 29.2%. However, the average revenue per user (ARPU) experienced a decline of 23.8% to USD 2.4 during the reported quarter from USD 3.2 in the March 2023 quarter. Despite this decline, ARPU rose by 12.5% on a constant currency basis.

The total customer base of Airtel Africa expanded by 9% year-over-year to reach 152.7 million by the end of the reported fiscal year. The data customer segment saw a significant increase of 17.8% to 64.4 million from 54.6 million a year prior.

Mobile Money revenue also witnessed robust growth of 32.8% in constant currency terms, with East Africa being highlighted for its strong performance.

In terms of financial health, Airtel Africa managed to slightly reduce its net debt to USD 3,505 million during the reported fiscal year from USD 3,524 million on a year-over-year basis.

This financial report underscores Airtel Africa's resilience and strategic adaptability in navigating through economic challenges while continuing to grow its customer base and service offerings across its markets.