• Thursday, June 20, 2024
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Airtel’s $460 million profit wiped out by FX loss

Airtel’s $460 million profit wiped out by FX loss

Airtel Africa would have made $460 million in profit after tax in its full year, which ended March 2024, if not for currency devaluations in Nigeria and Malawi.

A foreign exchange loss of $549 million ensured that the telco could only record a loss after tax of $89 million. In its full-year report released on Thursday, the telco said its reported revenue declined by 5.3 percent to $4.98 billion, primarily due to the naira’s devaluation.

The telco’s revenue in constant currency grew by 20.9 percent, accelerating to 23.1 percent in the fourth quarter of 2024.

“Nigerian constant currency revenue growth accelerated to 34.2 percent in Q4’24 despite the challenging backdrop. Reported currency revenues declined by 5.3 percent to $4,979m, reflecting the impact of currency devaluation, particularly in Nigeria,” the telco said.

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Significant currency devaluations in Nigeria, Malawi, Zambia, and Kenya particularly impacted Airtel’s reported currency revenue. It highlighted that the naira devalued significantly from N461/$ in March 2023 to N1,303/$ in March 2024.

Olusegun Ogunsanya, chief executive officer of Airtel Africa, said, “The consistent deployment of our ‘Win with’ strategy supported the acceleration in constant currency revenue growth over the recent quarters, which has reduced the impact of currency headwinds faced across most of our markets.”

The telco’s total customer base grew by 9.0 percent to 152.7 million, and its data customers rose by 17.8 percent to 64.4 million.

For context, MTN Nigeria, the other publicly traded telco in the country, recorded an N656.3 billion foreign exchange loss in the first quarter of 2024, incurring a loss after tax of N392.7 billion for Q1 2024.

Without the naira’s devaluation, the company would have turned a profit of N263.7 billion, more than double (143.3 percent) the N108.4 billion recorded in the first quarter of last year.