Airtel Africa Q3 net profit up 13%, says performance improvement across business

Airtel Africa on Friday posted about 13 per cent year-on-year rise in net profit to $116 million (about Rs 845 crore) for quarter ended December 2020, and said the performance improvement resonated across the business.

The net profit was at $103 million in quarter ended December 2019.

The revenue rose 17.2 per cent to $1,034 million (about Rs 7,527.5 crore), on a reported basis for Airtel Africa, that provides telecom and mobile money services and has a presence in 14 countries in Africa.

For the nine-month period ended December 2020, the profit-after-tax (PAT) stood at $261 million (over Rs 1,900 crore), about 21 per cent lower than the same period previous year.

"This was largely a result of the prior year period recognition of a one-off gain of $72 million related to the expired indemnity to certain pre-IPO investors, a higher deferred tax credit of $29 million in the previous period, as well as higher finance costs and tax in the current period," the company said.

Excluding the benefit of exceptional items and one-off derivative gain in the prior period, PAT increased by 30.1 per cent, it added.

Commenting on the Q3 results, Raghunath Mandava, chief executive officer of Airtel Africa said the latest third quarter performance demonstrated accelerated growth in both revenue and underlying EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization).

This was driven by continued delivery of strong customer growth in third quarter, despite the introduction (mid-December) of additional customer registration requirements in the Nigeria market.

"This has meant a temporary halt to the ability of all operators in the country to onboard new customers. But we are working closely with the government to ensure that all our subscribers provide their valid National Identification Numbers (NINs) and update their SIM registration records, such that disruption is minimised," Mandava said.

Mandava further said the performance improvement reflected across the business, and that the company logged continued strong revenue growth in Nigeria and East Africa.

"Finally, while the COVID-19 pandemic has had little impact on our most recent quarter, we remain vigilant about the recent news flow around new strains of the virus and further actions by governments to minimize contagion in our countries of operation," Mandava said.

The opportunities for sustainable profitable growth from underpenetrated markets for both mobile and mobile money services remain "hugely attractive", and the company remains confident of delivering on growth strategy, he pointed out.