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Airtel Africa Q2 net profit up 39% YoY; data usage boosts

This profit growth was driven by rising data consumption and lower finance costs.

, ET Bureau|
Oct 25, 2019, 03.00 PM IST
Bharti Airtel’s Africa unit posted a 39 per cent increase on-year in net profit to reach $90 million for the quarter ended September 2019 on-year, on revenue of $844 million on constant currency terms. This profit growth was driven by rising data consumption and lower finance costs.

The Africa unit, which crossed the 100 million customer mark in July, said its revenue growth of 10 per cent in reported currency was driven by double-digit growth in Nigeria and East Africa, partially offset by a slight decrease in Rest of Africa.

"These figures underline the strength of our ability to consistently deliver growth across voice, data and mobile money. In the first 6 months of this financial year, we delivered revenue growth of 11.4 per cent in constant currency terms, with even higher underlying EBITDA growth as we continued to improve our operating leverage and tight focus on costs,” said Raghunath Mandava, Chief Executive Officer of Airtel Africa.

"This performance underlines our ability to consistently grow in double digits, powered by our growth engines of Data and Airtel Money growing at 37 per cent and 46 per cent respectively. This is the 7th quarter of double-digit growth with EBITDA margin expansion of over 90 basis points," he added.

Airtel Africa’s data revenue was up 39 per cent at $229 million on-year and was the largest contributor to growth owing to an increasing number of customers taking to high-speed LTE services, resulting in a 57 per cent growth in data usage. Data average revenue per user (Arpu) rose to 2.5$ up 20 per cent in constant currency terms for the September ended quarter, on-year.

Voice revenue in constant currency grew by 3.3 per cent to $491 million largely driven by customer growth driven by stable churn and expansion of distribution infrastructure. Voice Apru however declined by 6 per cent on-year to $1.6 in the quarter due to weakness in Rest of Africa and decrease in interconnect rates across key markets, especially in East Africa which more than offset ARPU growth in Nigeria.

The company termed the revenue generated from mobile money revenue as its fastest growing business, which increased by 51 per cent to $79 million on the back of expanded distribution reach.

Amid the growth factors, the company’s free cash flow was almost flat at $225 million on-year.

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