Airtel Africa’s profit drops 12.2 percent to $132 million on elevated finance costs

Bharti Airtel’s Africa arm published net profit of $132.2 million in the June quarter, down 12.2 percent from the  respective quarter of the past year, as greater financing costs and reduced earnings on outstanding products offset  its operating profit development.

These were the first economic outcomes of the company since last month raising $750 million through its original  public offering (IPO). The stocks were then priced at 80 pence per piece, giving it a market capitalization of around $3.9 billion.

The firm said that It posted income of $795.9 million, up 6.9 percent year-on-year from $744.5 million, driven mainly by  double-digit development in Nigeria and East Africa, but partly offset by a decrease in income in the remainder of Africa .

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The rise in income is important for Bharti Airtel’s African arm, which is fighting a bruising tariff war at home with  rival Reliance Jio Infocomm Ltd

The client base of Airtel Africa is 99.7 million. Its average income per user (Arpu) was $2.7 in the quarter of June.

“Voice revenue, our largest business product, was up 3% largely driven by 9% growth in our customer base, now reaching nearly 100 million customers across our footprint. Data revenue, our largest contributor to growth, was up 36%, as an increasing number of customers relied on our high-quality and high-speed LTE network, resulting in 79% growth in data usage. Mobile money revenue, our fastest growing business, increased by 42%, as we expanded our distribution reach,” Raghunath Mandava, chief executive officer, Airtel Africa, said in a statement.

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On 1 August, Bharti Airtel will declare its June quarter income for India activities. Africa has proven to be a beacon  of hope for the company facing a struggling Indian business.

Airtel Africa is the holding company for Bharti Airtel’s activities in 14 nations, with Nigeria alone accounting for  almost half of its income before interest, taxes, depreciation and amortization (Ebitda).

Airtel Africa’s Ebitda rose 9.7 percent year-on-year from $316.9 million in the year- ago period to $347.6 million in the quarter of June.

Revenue from data services grew from $156.6 million a year ago to $207.1 million a quarter, while speech income  was flat at $469.9 million.

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