Airtel Africa Plc has on the London Stock Exchange repurchased an aggregate of 5.79million ordinary shares from Citigroup Global Markets Limited (Citi) since the commencement of its share buy-back programme on March 1, 2024.
The share buy-back which commenced on March 1 will return up to $100 million to shareholders over a period of up to 12 months.
The sole purpose of the buy-back programme is to reduce the capital of Airtel Africa Plc. As such, all shares purchased under the buy-back programme will be cancelled.
Airtel Africa entered into an agreement with Citigroup Global Markets Limited to conduct the first tranche of the buy-back and carry out on-market purchases of its ordinary shares with the Company subsequently purchasing its ordinary shares from Citi.
Under this agreement, Citi acts as riskless principal and makes decisions independently of the Company.
At the Nigerian Exchange (NGX), Airtel Africa’s notification of transactions in own shares showed detailed information of the individual trades made by Citigroup Global Markets Limited as part of the buy-back programme.
For instance, on March 4 Airtel Africa repurchased 500,000 units of its ordinary shares while on March 1, its purchased 491,861 of same shares. On March 5, the company’s aggregate number of ordinary shares purchased stood at 315,000. The transaction was on a volume weighted average price of GBp 96.73.
At the Nigerian Exchange Limited (NGX), Airtel Africa share price has remained at a 52-week high of N2,200 per share as against a 52-week low of N1,175. The company has 3,758,151,504 shares outstanding.
Airtel Africa is a leading provider of telecommunications and mobile money services, with presence in 14 countries in Africa, primarily in East Africa and Central and West Africa.
On March 6, the aggregate number of ordinary shares of Airtel Africa repurchased by the company was 315,000 shares at volume weighted average price of GBp 98.14.
On March 7, Airtel bought back its 395,624 shares from Citi at volume weighted average price of GBp 95.82, while on March 8, its 592,158 ordinary shares were bought back at volume weighted average price of GBp 94.36.
Airtel Africa plc in its recently released results for nine-month (9M) period ended December 31, 2023 shows that its revenue in constant currency grew by 20.2perent, with third-quarter (Q3) 2024 growth accelerating to 21percent.
Also, its reported currency revenues declined by 1.4percent to $3.861billion. In Q3’24, reported currency revenues declined by 8.3percent as currency devaluation (primarily the Nigerian naira devaluation) continued to impact reported revenue trends.
Airtel Africa offers an integrated suite of telecommunications solutions to its subscribers, including mobile voice and data services as well as mobile money services both nationally and internationally.
In the nine-month period ended December 31, 2023 all segments of Airtel Africa continued to deliver double-digit constant currency growth.
Across the Group mobile services revenue grew by 18.6percent in constant currency, driven by voice revenue growth of 11.2percent and data revenue growth of 28.5percent. Mobile money revenue grew by 31.8percent in constant currency.
Constant currency Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) increased 21.9percent, with Q3’24 EBITDA growing 23.3percent. The EBITDA margin of 49.4percent increased 72 basis points (bps) over the prior period despite foreign exchange headwinds and inflationary pressure. Reported currency EBITDA declined by 0.4percent to $1.908billion, with Q3’24 EBITDA 8.3percent lower as currency headwinds continued to impact reported trends.
Profit after tax was $2million in the period, primarily impacted by significant foreign exchange headwinds, particularly the $330million exceptional loss after tax following the devaluation of the Nigerian naira in June 2023 and the Malawian kwacha in November 2023 after the structural changes in their respective FX markets. The Nigerian naira devalued further in Q3’24, resulting in a $140million derivative and foreign exchange losses net of tax, which is not treated as an exceptional item.
In the review period, Airtel Africa’s earnings per share (EPS) before exceptional items was 7.1 cents, a decline of 34.6percent. Basic EPS at negative (1.6 cents) compares to 12.5 cents in the prior period, impacted by the significant derivative and foreign exchange losses as explained above.
Airtel Africa commenced its share buy-back programme, further to its announcement on February 1, 2024 following the publication of its nine-month results ended December 31, 2023.
While the March 4 buy-back was at a volume weighted average price of GBp 97.07 per ordinary share, the March 1 buy-back was at volume weighted average price of GBp 97.14 per ordinary share.
The share buy-back programme is expected to be phased over two tranches, with the ongoing first tranche anticipated to end on or before August 31, 2024. This first tranche will amount to a maximum of $50 million.
This buy-back programme reflects the significant progress made in recent years to reduce leverage and strengthen the Company’s balance sheet. In light of the cash accretion at the holding company level, the current leverage and the consistent strong operating cash generation, Airtel Africa is well positioned to undertake this share buy-back to enhance shareholder returns which is consistent with its existing capital allocation policy.
On March 11, Airtel Africa’s 550,000 ordinary shares were repurchased from Citi at volume weighted average price of GBp 94.69. On March 12, the company repurchased its 460,000 ordinary shares at volume weighted average price of GBp 96.32.
Also, on March 13 the Airtel Africa’s 578,000 ordinary shares were bought back from Citigroup at volume weighted average price of GBp 94.74. On March 14, the company bought back its 599,847 ordinary shares at volume weighted average price of GBp 93.39. Likewise, on March 15, Airtel Africa repurchased its 498,000 ordinary shares at a volume weighted average price of GBp 94.53, while on March 18, 497,622 ordinary shares of Airtel Africa were bought back from Citigroup at volume weighted average price of GBp 94.28.
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