Nigeria is Airtel Africa’s cash-cow as evidenced by its immense contribution to Group’s earnings.
The Chief Executive Officer (CEO) of the telecommunications giant said during a conference call with reporters across the continent that on a market specific basis, Nigeria has been leading the company’s growth with double digit voice revenue growth and over 70 percent data growth.
With a huge population of 200 million (largest on the continent) and the proliferation of smartphones in recent years, it is unsurprising that the country has been taking a giant stride in data usage.
Analysts have attributed the improved earnings in the Nigeria operation to a stable foreign exchange environment. The central bank is to thank for this as the apex bank introduced a new foreign exchange regime that eased the flow of liquidity in the system.
Analysis of the nine month period for Airtel Africa, which ended December 2019 showed that it realized revenue of $2.52 billion.
Of the total Group revenue of $2.52 billion, Airtel Nigeria contributed 39. percent ($995 million); to this figure, East Africa 35 percent, ($851 million), and Rest of Africa, (25 percent), $644 million.
Airtel Nigeria’s recorded 23.40 percent revenue growth in the period under review, thanks to double digit expansion in data and voice data.
That compares with East Africa, (12 percent) and a reduction in sales for Rest of Africa.
Airtel Nigeria’s earnings are stable compared to peers across the continent.
It recorded 37.10 percent growth in Earnings Before Interest Taxation Depreciation and Amortization (EBITDA), that compares to a 14.40 percent expansion recorded by East Africa, and a contraction of 12.60 percent in Rest of Africa.
Operating profit increased by 62.80 percent in December 2019, that compares with East Africa, (30.40 percent), and a 35.40 percent contraction in Rest of Africa.
The company is making money for shareholder as it is contemporaneously translating top line (revenue) impressive performance into bottom line growth.
Airtel Africa has been spending copiously on its Nigeria operations and it is taking the lead in the roll out of 4G network.
In November 2019, Airtel Network Limited (Aitel Nigeria) signed an agreement with intercellular Nigeria Ltd, in order to acquire additional MHZ 10 spectrum in the MHZ 900 in Nigeria for a consideration of $70 million.
