Airtel Africa Records $52 Million Profit in Q1

Bharti Airtel Limited is an Indian global telecommunications services company based in New Delhi, India. It operates in 18 countries across South Asia and Africa. Airtel provides GSM, 3G and 4G LTE mobile services, fixed line broadband and voice services depending upon the country of operation. Airtel is also testing VoLTE technology across five cities in India and should roll out the technology towards the end of 2017. It is the largest mobile network operator in India and the third largest in the world with 400 million subscribers. Airtel was named India’s second most valuable brand in the first ever Brandz ranking by Millward Brownand WPP plc.

Bharti Airtel’s Africa business reported a profit of $52 million for the first quarter of FY 2017-18 from a loss of $78 million a year ago, helped by growth in the data customer base and consumption, while overall revenue growth was helped by currency appreciation on-quarter in CFA, currency used in francophone countries in Africa, and Zambian Kwacha. The Sunil Mittal-led mobile carrier’s Africa revenue climbed 1.5% to $736 million in the three months ended June from $732 million a year earlier. The first quarter in 2017-18 becomes the second consecutive quarter showing profit in Africa.

Raghunath Mandava, MD and CEO of Africa said that revenue growth for the quarter was 1.5% on-year in the first quarter of the new fiscal, with net revenues up by 3.3% as it shed unprofitable revenue streams. Data consumption and revenues have grown by 75% and 11.3% on-year, respectively, in the quarter. “New KYC norms impacted customer additions and consequently revenue growth in the quarter. Our focus to deliver a more profitable business model for Africa has resulted in another quarter of EBITDA margin improvement, with underlying margins expanding by 8.1% Y-o-Y from 19.9% to 28.0%,” Mandava said in a statement issued by Bharti Airtel.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) rose by 42.6% to $206 million from $151 million, a year earlier. The Ebitda margin was at 28%, up from 19.9% in the corresponding quarter last year.  Mobile data revenue increased 11.3% to $138 million from a year earlier. Mobile data now represents 18.7% of total revenue compared with 16.9% in the same period a year ago.

Overall Africa average revenue per user (ARPU), a key performance metric, fell by 5.4% to $3.1 on-year, while sequentially it fell by 0.4%. Total minutes on the network, were up 4.6% to 35.7 billion, from 34.1 billion in the same period the previous year. Data realisation per MB fell 36.4% to $0.28 from $0.45 in the year-ago period despite Airtel Africa’s data customer base growing 19.4% to 19.4 million from 16.2 million earlier. Africa data traffic volumes rose by 75% to 48.4 billion MBs from 27.7 billion MBs, while data ARPU was down 7.4% to $2.4 in the same period. Sequentially, data ARPU fell by 1.3%. The company’s total Airtel Money customer base using the mobile money platform increased by 2.8% to 8.7 million in the quarter ended June 2017. Airtel Money’s transaction value was up by 31.4% to $4.3 billion in Q1 2018, from $3.3 billion the year before.