Airtel
Africa plc
Results for year ended 31 March 2024
09 May 2024
Delivering a
resilient performance with strong underlying momentum, despite a
volatile macro-economic environment
Operating highlights
·
Total customer base grew by 9.0% to 152.7
million. We continue to bridge the digital divide with a 17.8%
increase in data customers to 64.4 million and a 20.8% increase in
data usage per customer.
·
Mobile money subscriber growth of 20.7% reflects
our continued investment into distribution to drive increased
financial inclusion across our markets. Transaction value increase
of 38.2% in constant currency with annual transaction value of over
$112bn in reported currency. Increased transactions across the
ecosystem reflects the enhanced range of offerings and increased
customer adoption, supporting constant currency ARPU growth of
8.6%.
·
Continued network investment to support an
enhanced customer experience and drive increased 4G coverage. 95%
of sites now 4G operational, facilitating a 42.3% increase in 4G
customers over the year.
Financial performance
·
Revenue in constant currency grew by 20.9% with
growth accelerating to 23.1% in Q4'24. Nigerian constant currency
revenue growth accelerated to 34.2% in Q4'24 despite the
challenging backdrop. Reported currency revenues declined by 5.3%
to $4,979m reflecting the impact of currency devaluation,
particularly in Nigeria.
·
Across the group mobile services revenue grew by
19.4% in constant currency, driven by voice revenue growth of 11.9%
and data revenue growth of 29.2%. Mobile Money revenue grew by
32.8% in constant currency, with a continued strong performance in
East Africa.
·
EBITDA margins remained resilient at 48.8%
despite the currency headwinds and inflationary pressure on our
cost base. Constant currency EBITDA increased 21.3% with reported
currency EBITDA declining 5.7% to $2,428m. Q4'24 EBITDA margins of
46.5% were impacted by the lower contribution of Nigeria following
the Q4'24 naira devaluation and rising energy costs across a number
of markets.
·
Loss after tax was $89m, primarily impacted by
significant foreign exchange headwinds, resulting in a $549m
exceptional loss net of tax following the Nigerian naira
devaluation in June 2023 and Q4'24, and the Malawian kwacha
devaluation in November 2023.
·
Basic EPS of negative (4.4 cents) compares to
17.7 cents last year. EPS before exceptional items was 10.1 cents,
a decline of 25.9%. Both EPS before exceptional items and basic EPS
were primarily impacted by significant derivative and foreign
exchange losses during the year. EPS before exceptional items and
derivative and foreign exchange losses was 18.3 cents compared to
20.5 cents in the prior period.
Capital allocation
·
Capex was broadly flat at $737m and was below our
guidance largely due to a deferral in data centre investments. In
addition, we invested $152m in licence renewal and spectrum
acquisitions, including $127m for the Nigerian 3G licence
renewal.
·
Leverage of 1.4x on 31 March 2024 was flat from
the previous year. We have around $680m of cash available at
HoldCo, to be utilized to fully repay the remaining $550m debt,
falling due in May 2024.
·
The Board has approved a share buyback programme
of up to $100m, over a period of up to 12 months. On 1 March 2024,
we announced the commencement of the first tranche of this buyback
up to a maximum of $50m. During March 2024, the company purchased
7.4 million shares for a total consideration of $9m.
·
The Board has recommended a final dividend of
3.57 cents per share, making the total dividend for FY24 5.95 cents
per share.
Sustainability strategy
·
Our landmark five-year $57m partnership with
UNICEF launched across 13 markets providing access to educational
resources, free of charge, on our way to transforming the lives of
over one million children through digital learning by
2027.
·
Partnered with the Government of Rwanda to launch
the ConnectRwanda 2.0 initiative which aims to provide more than a
million people with affordable smartphones to bridge the digital
divide.
Olusegun Ogunsanya, Chief executive officer, on the trading
update:
"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.
This strong revenue performance is a reflection not only of
the opportunity that is inherent across our markets, but also the
resilience of our affordable offerings despite the inflationary
pressure many of our customers have experienced.
Facilitating this growth has been,
and will remain, fundamental to our performance. The investment in
our distribution to catalyse growth, and the technology required to
support this growth has been key. Furthermore, our rigorous
approach to de-risking our balance sheet and our capital allocation
priorities has materially reduced the risks that the currency
devaluation has had on our business. Key initiatives include the
reduction of US dollar debt across the business and the
accumulation of cash at the HoldCo level to fully cover the
outstanding debt due. We will continue to focus on reducing our
exposure to currency volatility. At the beginning of March, we
launched our first buyback programme reflecting the strength of our
financial position.
The growth opportunity that exists
across our markets remains compelling, and we are well positioned
to deliver against this opportunity. We will continue to focus on
margin improvement from the recent level as we progress through the
year.
I want to say a particular
thank-you to our customers, partners, governments and regulators
for their support and our employees for their unrelenting
contribution to the business. Our purpose of transforming lives
across Africa will continue to be our highest priority.
GAAP measures
(Year ended)
|
Description
|
Mar-24
|
Mar-23
|
Reported
currency
|
$m
|
$m
|
change
|
Revenue
|
4,979
|
5,255
|
(5.3%)
|
Operating profit
|
1,640
|
1,757
|
(6.7%)
|
(Loss)/Profit after tax
|
(89)
|
750
|
(111.9%)
|
Basic EPS ($ cents)
|
(4.4)
|
17.7
|
(124.9%)
|
Net cash generated from operating
activities
|
2,259
|
2,229
|
1.4%
|
Alternative performance measures (APM)
1
(Year ended)
|
Description
|
Mar-24
|
Mar-23
|
Reported
currency
|
Constant
currency
|
$m
|
$m
|
change
|
change
|
Revenue
|
4,979
|
5,255
|
(5.3%)
|
20.9%
|
EBITDA
|
2,428
|
2,575
|
(5.7%)
|
21.3%
|
EBITDA margin
|
48.8%
|
49.0%
|
(22)
bps
|
14
bps
|
EPS before exceptional items ($
cents)
|
10.1
|
13.6
|
(25.9%)
|
|
Operating free cash
flow
|
1,691
|
1,827
|
(7.4%)
|
|
(1)
Alternative
performance measures (APM) are described on page 50, with a
reconciliation on page 53.
About Airtel Africa
Airtel Africa is a leading
provider of telecommunications and mobile money services, with a
presence in 14 countries in Africa, primarily in East Africa and
Central and West Africa.
Airtel Africa offers an integrated
suite of telecoms solutions to its subscribers, including mobile
voice and data services as well as mobile money services, both
nationally and internationally. We aim to continue providing a
simple and intuitive customer experience through streamlined
customer journeys.
Enquiries
Conference call
Management will host an analyst
and investor conference call at 13:00pm UK time (BST), on Thursday
09th May 2024, including a Question-and-Answer session.
To receive an invitation with the
dial in numbers to participate in the event, please register
beforehand using the following link:
Conference call registration link
Key consolidated financial information
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported currency
change %
|
Constant currency
change %
|
Mar-24
|
Mar-23
|
Reported currency
change %
|
Constant currency
change %
|
Profit and loss
summary
|
|
|
|
|
|
|
|
|
|
Revenue 1
|
$m
|
4,979
|
5,255
|
(5.3%)
|
20.9%
|
1,118
|
1,341
|
(16.6%)
|
23.1%
|
Voice revenue
|
$m
|
2,179
|
2,491
|
(12.5%)
|
11.9%
|
472
|
619
|
(23.8%)
|
13.7%
|
Data revenue
|
$m
|
1,734
|
1,787
|
(3.0%)
|
29.2%
|
391
|
469
|
(16.5%)
|
31.1%
|
Mobile money revenue
2
|
$m
|
837
|
692
|
21.1%
|
32.8%
|
206
|
176
|
17.0%
|
35.5%
|
Other revenue
|
$m
|
417
|
437
|
(4.6%)
|
23.4%
|
97
|
116
|
(16.5%)
|
25.7%
|
Expenses
|
$m
|
(2,572)
|
(2,694)
|
(4.5%)
|
20.9%
|
(600)
|
(686)
|
(12.6%)
|
26.3%
|
EBITDA 3
|
$m
|
2,428
|
2,575
|
(5.7%)
|
21.3%
|
520
|
659
|
(21.0%)
|
19.3%
|
EBITDA margin
|
%
|
48.8%
|
49.0%
|
(22)
bps
|
14
bps
|
46.5%
|
49.1%
|
(259)
bps
|
(148)
bps
|
Depreciation and
amortisation
|
$m
|
(788)
|
(818)
|
(3.6%)
|
23.3%
|
(173)
|
(220)
|
(21.0%)
|
17.9%
|
Operating profit
|
$m
|
1,640
|
1,757
|
(6.7%)
|
20.3%
|
347
|
439
|
(21.0%)
|
20.0%
|
Other finance cost - net of
finance income
|
$m
|
(896)
|
(723)
|
24.0%
|
|
(142)
|
(204)
|
(30.3%)
|
|
Finance cost - exceptional items
4
|
$m
|
(807)
|
-
|
0.0%
|
|
(323)
|
-
|
0.0%
|
|
Total finance cost
5
|
$m
|
(1,703)
|
(723)
|
(135.6%)
|
|
(465)
|
(204)
|
127.9%
|
|
(Loss)/Profit before tax
|
$m
|
(63)
|
1,034
|
(106.1%)
|
|
(118)
|
233
|
(150.8%)
|
|
Tax
|
$m
|
(284)
|
(445)
|
(36.1%)
|
|
(77)
|
(105)
|
(26.3%)
|
|
Tax - exceptional items
6
|
$m
|
258
|
161
|
60.1%
|
|
104
|
99
|
5.5%
|
|
Total tax
credit/(charge)
|
$m
|
(26)
|
(284)
|
(90.8%)
|
|
27
|
(6)
|
(548.0%)
|
|
(Loss)/Profit after tax
|
$m
|
(89)
|
750
|
(111.9%)
|
|
(91)
|
227
|
(140.2%)
|
|
Non-controlling
interest
|
$m
|
(76)
|
(87)
|
(12.7%)
|
|
(13)
|
(32)
|
(58.9%)
|
|
Profit attributable to owners of
the company - before exceptional items
|
$m
|
380
|
512
|
(25.8%)
|
|
115
|
106
|
8.1%
|
|
(Loss)/Profit attributable to owners of the
company
|
$m
|
(165)
|
663
|
(124.9%)
|
|
(104)
|
195
|
(153.2%)
|
|
EPS - before exceptional
items
|
cents
|
10.1
|
13.6
|
(25.9%)
|
|
3.0
|
2.8
|
7.8%
|
|
Basic EPS
|
cents
|
(4.4)
|
17.7
|
(124.9%)
|
|
(2.8)
|
5.2
|
(153.2%)
|
|
Weighted average number of
shares
|
million
|
3,751
|
3,752
|
(0.0%)
|
|
3,750
|
3,750
|
0.0%
|
|
Capex
|
$m
|
737
|
748
|
(1.4%)
|
|
243
|
291
|
(16.5%)
|
|
Operating free cash
flow
|
$m
|
1,691
|
1,827
|
(7.4%)
|
|
277
|
368
|
(24.6%)
|
|
Net cash generated from operating
activities
|
$m
|
2,259
|
2,229
|
1.4%
|
|
493
|
518
|
(4.7%)
|
|
Net debt
|
$m
|
3,505
|
3,524
|
|
|
3,505
|
3,524
|
|
|
Leverage (net debt to
EBITDA)
|
times
|
1.4x
|
1.4x
|
|
|
1.4x
|
1.4x
|
|
|
Return on capital
employed
|
%
|
23.0%
|
23.3%
|
(31)
bps
|
|
23.9%
|
23.4%
|
48
bps
|
|
Operating KPIs
|
|
|
|
|
|
|
|
|
|
ARPU
|
$
|
2.8
|
3.3
|
(13.3%)
|
10.7%
|
2.4
|
3.2
|
(23.8%)
|
12.5%
|
Total customer base
|
million
|
152.7
|
140.0
|
9.0%
|
|
152.7
|
140.0
|
9.0%
|
|
Data customer base
|
million
|
64.4
|
54.6
|
17.8%
|
|
64.4
|
54.6
|
17.8%
|
|
Mobile money customer
base
|
million
|
38.0
|
31.5
|
20.7%
|
|
38.0
|
31.5
|
20.7%
|
|
(1)
Revenue includes inter-segment eliminations of
$188m for the year ended 31 March 2024 and $152m for the prior
year.
(2) Mobile money revenue post inter-segment eliminations with
mobile services was $649m for the year ended 31 March 2024, and
$540m for the prior year.
(3) EBITDA includes other income of $21m for the year ended 31
March 2024 and $13m for the prior period.
(4) Exceptional items of $807m for the year ended 31 March 2024
relates to derivative and foreign exchange losses following the
devaluation of the Nigerian naira ($770m) in June 2023 and
three-month period ended 31 March 2024 as well as Malawian kwacha
devaluation in November 2023 ($37m), respectively.
(5)
Please refer to the commentary on finance costs
as part of 'Financial review' section on page 5.
(6) Tax exceptional items of $258m for the year ended 31 March
2024 reflects the gain corresponding to the $807m exceptional item
referred to in point 4 above. $161m exceptional tax gain in the
prior period reflects the recognition of deferred tax credit in
Kenya, Democratic Republic of the Congo & Tanzania.
Financial review for the year ended 31 March
2024
Revenue
Group revenue in reported
currency declined by 5.3% to $4,979m, with constant currency growth
of 20.9%, which accelerated to 23.1% in Q4'24. Reported currency
revenue growth was particularly impacted by significant currency
devaluations in Nigeria, Malawi, Zambia and Kenya. Group mobile
services revenue grew by 19.4% in constant currency, with voice
revenue growth of 11.9% and data revenues growing 29.2%. In
Nigeria, constant currency mobile services revenues increased by
25.8%, whilst East Africa saw 21.5% growth and Francophone Africa
increased by 9.2%. Mobile money revenue grew by 32.8% in constant
currency, primarily driven by continued strong growth in East
Africa.
EBITDA
Reported currency EBITDA declined
by 5.7% to $2,428m reflecting the impact of currency devaluation
over the period, particularly in Nigeria. In constant currency,
EBITDA increased to 21.3% with EBITDA margins of 48.8%, up by
14bps. Reported currency EBITDA margins of 48.8% remained resilient
despite the currency and inflationary headwinds faced in several
markets. Mobile services EBITDA increased 18.8% in constant
currency as operating leverage and cost efficiencies continued to
limit the FX headwinds and inflationary pressure over the year.
Mobile money EBITDA margins of 52.1% increased 234bps in constant
currency, supporting growth of 39.0%.
Nigeria currency devaluation
impact on revenue and EBITDA
During the period, the Nigerian
naira devalued significantly from 461 per US dollar in March 2023
to 1,303 per US dollar in March 2024. The impact of the Nigerian
naira devaluation on reported revenue and EBITDA for the year
ending 31 March 2024 was $1,042m and $554m respectively. As the
currency devaluation occurred at various stages during the year,
revenue and EBITDA in the reporting period does not reflect the
full year impact. As a result, the next financial year reported
currency results will continue to reflect the currency headwinds
experienced during FY'24. If the closing rate of 1,303 NGN/USD were
to be used to consolidate the results of the Group for the year
ended 31 March 2024[1], reported revenue would have declined further by $603m to
$4,376m (16.7% YoY decline) as opposed to the 5.3% decline
reported. Similarly, EBITDA would have declined further by $324m to
$2,104m (18.3% YoY decline) as opposed to the 5.7% decline
reported, with an EBITDA margin of 48.1% (Q4'24:
46.4%).
For future sensitivity on
currency devaluation, refer to the Risk section on page
21.
Finance costs
Total finance costs for the year
ended 31 March 2024 was $1,703m, primarily impacted by $1,259m of
derivative and foreign exchange losses (reflecting the revaluation
of US dollar balance sheet liabilities and derivatives) as a result
of the currency devaluation primarily in Nigeria and Malawi.
Finance costs excluding derivative and foreign exchange losses
increased from $385m to $444m in the current period primarily on
account of shift of foreign currency debt to local currency debt in
the operating entities carrying a higher average interest rate.
Out of $1,259m derivative and
foreign exchange losses, $807m was classified as an exceptional
item as per the company's policy on exceptional
items[2] of which $770m
is related to Nigerian naira devaluation and $37m is related to
Malawian kwacha devaluation.
(Loss)/Profit before tax
Loss before tax at $63m during the
year ended 31 March 2024 was largely impacted by the $807m
exceptional losses discussed above. Excluding these exceptional
items, profit before tax for year ended 31 March 2024 was
$744m.
Taxation
Total tax charges were $26m as
compared to $284m in the prior period. Total tax charges reflected
an exceptional gain of $258m on account of the Nigerian naira and
Malawian kwacha devaluation during the current period compared with
recognition of deferred tax credit of $161m in Kenya, Democratic
Republic of the Congo and Tanzania in the prior period, hence a
higher exceptional gain of $97m. Tax charges excluding exceptional
items were $284m compared to $445m in the prior period.
Tax charge of $26m during the year
ended 31 March 2024, despite a loss before tax of $63m was due to
change in profit mix between various OpCos and withholding taxes on
dividends by subsidiaries.
(Loss)/Profit after tax
Loss after tax of $89m during the
year ended 31 March 2024 was primarily impacted by the $549m net of
tax impact of the exceptional derivative and foreign exchange
losses. Excluding these exceptional items, profit after tax for
year ended 31 March 2024 was $460m.
Basic EPS
Basic EPS at negative 4.4 cents
during the year ended 31 March 2024 was impacted by the derivative
and foreign exchange losses as explained above. EPS before
exceptional items and derivative and foreign exchange losses for
the year ended 31 March 2024 was 18.3 cents.
Leverage
Leverage of 1.4x as on 31 March
2024 was broadly flat from the previous year despite our
significant investments and the currency devaluation in several
markets which resulted in lower reported currency EBITDA as
compared to the previous year. The remaining debt at HoldCo is now
$550m, falling due in May 2024. Cash at HoldCo was around $680m at
the end of the period and the Group is fully geared to repay the
HoldCo debt when due using this cash.
GAAP measures
Revenue
Reported revenue of $4,979m,
declined by 5.3% in reported currency, and grew by 20.9% in
constant currency driven by both customer base growth of 9.0% and
ARPU growth of 10.7%. The gap between constant currency and
reported currency revenue growth was due to the average currency
devaluations between the periods, mainly in the Nigerian naira, the
Malawi kwacha, the Zambian kwacha , and the Kenyan shilling,
partially offset by an appreciation in the Central African
franc.
Reported mobile services revenue
at $4,338m, declined 8.1%, and grew by 19.4% in constant currency.
Constant currency growth was driven by growth of 25.8% in Nigeria,
21.5% in East Africa and 9.2% in Francophone Africa, respectively.
Mobile money revenue grew by 21.1% in reported currency. In
constant currency, mobile money revenue grew by 32.8%, driven by
revenue growth in East Africa of 36.0% and Francophone Africa of
22.3%.
Operating profit
Operating profit in reported
currency declined by 6.7% to $1,640m as currency headwinds offset
strong revenue growth and continued improvements in operating
efficiency across the Group.
Total finance costs
Total finance costs for the year
ended 31 March 2024 of $1,703m, increased $980m over the prior
period. Finance costs were primarily impacted by $807m of
exceptional derivative and foreign exchange losses arising in
Nigeria and Malawi, following the significant currency devaluation
during the period.
The Group's effective interest
rate increased to 10.1% compared to 7.7% in the prior period,
largely driven by higher local currency debt at the OpCo level, in
line with our strategy of localising debt at OpCo.
Taxation
Total tax charges of $26m declined
from $284m in the prior period. Total tax charges reflected an
exceptional gain of $258m on account of the Nigerian naira and
Malawian kwacha devaluation during the current period, compared to
an exceptional gain of $161m in the prior period on account of
deferred tax credits in Kenya, Democratic Republic of the Congo and
Tanzania. As a result, total tax charges reflected a higher
exceptional gain of $97m in the current period. The tax charge of
$284m is net of a tax gain of $30m arising from the reversal of
deferred tax liability on account of a reduction of undistributed
retained earnings of Nigeria. This reduction is an indirect
consequence of the impact of the Nigerian naira
devaluation.
(Loss)/Profit after tax
(Loss) after tax of $89m during
the year ended 31 March 2024 was primarily impacted by the $549m
net of tax impact of the exceptional derivative and foreign
exchange losses.
Basic EPS
Basic EPS at negative 4.4 cents
during the year ended 31 March 2024 was impacted by the derivative
and foreign exchange losses as explained above.
Net cash generated from operating
activities
Net cash generated from operating
activities was $2,259m, up 1.4% as compared to $2,229m in the prior
period.
Alternative performance measures[3]
EBITDA
EBITDA of $2,428m, declined by
5.7% in reported currency, and increased by 21.3% in constant
currency. Growth in constant currency EBITDA was led by revenue
growth and supported by continued improvement in operating
efficiencies which limited the impact that inflationary cost
pressures had in a number of markets. The EBITDA margin declined by
22 basis points in reported currency to 48.8%.
The gap between constant currency
and reported currency EBITDA growth was due to the currency
devaluations between the periods, mainly in the Nigerian naira, the
Malawi kwacha, the Zambian kwacha, and the Kenyan shilling,
partially offset by an appreciation in the Central African
franc.
Tax
The effective tax rate was 38.4%,
compared to 38.8% in the prior period, largely due to profit mix
changes amongst the OpCos. The effective tax rate is higher than
the weighted average statutory corporate tax rate of approximately
32%, largely due to the profit mix between various OpCos and
withholding taxes on dividends by subsidiaries.
Exceptional items
The exceptional item of $807m is
on account of derivative and foreign exchange losses following the
devaluation of the Nigerian naira in June 2023 and Q4'24, and the
Malawian kwacha in November 2023. This has resulted in an
exceptional tax gain of $258m as compared an exceptional tax gain
of $161m in the prior period on account of deferred tax credits in
Kenya, Democratic Republic of the Congo and Tanzania.
EPS before exceptional
items
EPS before exceptional items of
10.1 cents declined by 25.9% compared to 13.6 cents in the prior
period primarily impacted by the significant derivative and foreign
exchange losses during the year. EPS before exceptional items and
derivative and foreign exchange losses was 18.3 cents compared to
20.5 cents in the prior period.
Operating free cash
flow
Operating free cash flow was
$1,691m, lower by 7.4%, as a result of lower EBITDA during the
period partially offset by lower capex in current
period.
Other significant updates
Commencement of share buy-back programme
On 1 February 2024, the company
announced that in light of the increase in HoldCo cash, current
leverage and the consistent strong operating cash generation, the
Board intended to launch a share buy-back programme of up to $100m,
over a 12 month period. The Board believes that repurchasing its
own shares is an attractive use of its capital in light of the
Group's strong long term growth outlook. The programme will be
executed using its cash reserves and in accordance with applicable
securities laws and regulation.
On 1 March 2024, Airtel Africa plc
announced the commencement of its share buyback programme, further
to the announcement on 1 February 2024 following the publication of
its nine-month results ended 31 December 2023. The share buy-back
programme is expected to be phased over two tranches, with the
first tranche commencing on 1 March 2024 and anticipated to end on
or before 31 August 2024. The first tranche will amount to a
maximum of $50 million, with Airtel Africa entering into an
agreement with Citigroup Global Markets Limited to conduct the
buy-back on its behalf. During March 2024, the company purchased
7.4 million shares for a total consideration of $9m.
Directorate changes
On 6 February 2024, Airtel Africa
plc announced that John Danilovich has informed the Board of
his intention to retire as an independent non-executive director
of Airtel Africa plc at the conclusion of this year's AGM
in July 2024.
On 30 October 2023 and 31 October
2023 Kelly Bayer Rosmarin and Doug Baillie, respectively retired as
non-executive directors of Airtel Africa plc.
On 9 May 2024, Airtel Africa plc
announced the appointment of Paul Arkwright, CMG, as an independent
non-executive director of the Company, with immediate
effect.
Nigerian naira devaluation
On 14 June 2023, the Central
Bank of Nigeria (CBN) announced changes to the operations in
the Nigerian Foreign Exchange (FX) market, including the
abolishment of segmentation, with all segments now collapsing into
the Investors and Exporters (I&E) window and the reintroduction
of the 'Willing Buyer, Willing Seller' model at the I&E
window. As a result of the CBN decision, the US dollar has
appreciated against the Nigerian naira in the I&E
window. The market expectation is that the new foreign
currency policy and subsequent realignment of the several market
exchange rates will provide greater US dollar liquidity over time
and help to alleviate the challenges faced in the last few years to
access US dollars in the market.
On 29 January 2024, the FMDQ
Securities Exchange Limited ('FMDQ') notified the market of its
amendment to the methodology applied for the computation of the
Nigerian Autonomous Foreign Exchange Fixing ('NAFEX') being the
exchange rate used to consolidate the results of Airtel Africa's
Nigeria region. This development further impacted the Nigerian
naira during the period. The closing NAFEX rate as of 31 March
2024, was NGN1,303 per US dollar.
The impact of both these events
resulted in derivative and foreign exchange losses of $770m in the
year which were classified as exceptional.
The Group continues to invest
in Nigeria to enable it to capture the growth
opportunity. This continued investment will facilitate growth,
drive continued digitalisation across the country, facilitate
economic progress and transform lives
across Nigeria.
Retirement of Airtel Africa plc CEO and appointment of
Successor
On 2 January 2024, Airtel Africa
plc announced the retirement of Chief Executive Officer Olusegun
"Segun" Ogunsanya and the appointment of Sunil Taldar, who joined
Airtel Africa in October 2023 as Director - Transformation, as
Chief Executive Officer (CEO). Following a transition period, Sunil
Taldar will be appointed to the Board as an Executive Director and
assume the role of CEO on 1 July 2024, at which time Segun will
retire from the Board and the Company.
Launch of Nxtra by Airtel
In December 2023, Airtel Africa
launched Nxtra by Airtel ("Nxtra"), a new data centre business
founded on a commitment to meet the continent's growing needs for
trusted, and sustainable data centre capacity and to serve the
fast-growing African digital economy. It aims to build one of the
largest network of data centres in Africa with high-capacity data
centres in major cities located strategically across Airtel
Africa's footprint, complementing its existing edge sites. Nxtra's
ambition will allow it to serve the growing need of African
enterprises and its data centre infrastructure will be designed to
host the next generation of computing, while providing multi-MW
capacity in a phased manner.
Nigerian Communications Commission directive on subscriber
registration compliance
In December 2023, the Nigerian
Communications Commission (NCC) informed Airtel Nigeria, in an
industry-wide directive, to undertake full network barring of all
SIMs that have failed to submit their National Identity Numbers
(NIN) on or before 28 February 2024. Likewise, customers that have
submitted their NINs, but remain unverified are to be barred by
31st July 2024 (earlier deadline was 15 April 2024). Furthermore,
guidelines were issued whereby no customer can have more than 4
active SIMs and all such excess SIMs be barred by 29 March 2024.
This directive is part of the ongoing Federal Government NIN-SIM
harmonisation exercise requiring all subscribers to provide valid
NIN information to update SIM registration records.
Airtel Nigeria has complied with
the directives issued and barred all customers without NINs as well
as customers with more than 4 active SIMs which had a very
negligible impact on revenue. Currently we are engaging with
approximately 5.7m customers whose NIN are yet to be verified.
Since the directive was issued in December 2023, 7.9m customers
have already been verified. We continue to engage with the NCC and
work closely with the relevant authorities to facilitate and
accelerate the verification process to minimise the risk of service
disruption to these customers, whilst also limiting the revenue
impact from our compliance to the directive issued.
Devaluation of the Malawian Kwacha by the Reserve Bank of
Malawi
In November 2023, the Reserve Bank
of Malawi (RBM) announced structural changes to the foreign
exchange market with its decision to adjust the exchange rate from
selling rate of MWK 1,180 to a selling rate of MWK 1,700 to the US
dollar with effect from 9 November 2023.
As part of the structural changes,
RBM started authorizing dealer banks to freely negotiate exchange
rates to trade with their clients and amongst themselves,
notwithstanding any limitations previously in place.
The devaluation resulted in a
foreign exchange loss of $37m and is classified as
exceptional.
Uganda Initial Public Offering (IPO)
On 29 August 2023, Airtel Uganda
Limited issued a prospectus in relation to the offer for sale of
8,000,000,000 ordinary shares, representing 20% of Airtel Uganda
Limited on the Uganda Stock Exchange (USE) in-line with the 20%
minimum public listing obligation for all National Telecom
Operators under the current Uganda Communications (Fees &
Fines) (Amendment) Regulations 2020. The issued shares of Airtel
Uganda were listed on the Main Investment Market Segment of the USE
on 7 November 2023 at UGX100 per share.
On completion of the IPO in
November 2023, 4.4bn shares (10.89% of Airtel Uganda's total share
capital) were transferred to minority shareholders, whilst the
entire 40bn shares began trading on the Main Investment Market
Segment of the USE. Airtel Uganda received a 3-year waiver from the
Uganda Securities Exchange from the requirement to transfer the
remaining 9.11% required to meet the 20% shareholding listing
requirement.
Nigeria 2100 MHz spectrum renewal
On 9 May 2023, the Group announced
that its Nigerian subsidiary, Airtel Networks
Limited ('Airtel Nigeria'), had made a payment
of NGN58.7bn ($127.4m), payable to the Nigerian
Communications Commission (NCC), to renew its 2x10MHz 2100 MHz
spectrum licence, which will be valid for a period of 15 years
following the expiry of the previous licence (30 April
2022).
This investment to renew the
licence reflects our continued confidence in the opportunity
inherent across the Nigerian market, supporting the local
communities and economies through furthering digital inclusion and
connectivity.
Uganda spectrum
The regulator had previously
issued an invitation to apply for spectrum in various bands (700,
800, 2300, 2600, 3300, 3500, etc). On 26 June 2023, the Uganda
Communications Commission confirmed that Airtel Uganda Limited had
qualified for the award of 10 MHz of 800 MHz and 100 MHz of 3500
MHz spectrum. There is no upfront payout for spectrum but,
instead, there is an annual payout of $1.2m for a period of 17
years, which is the validity period for the spectrum.
Share capital reduction
On 15 August 2023, Airtel Africa
announced the cancellation and extinction of all its deferred
shares of USD 0.50 nominal value each (the 'capital
reduction'), which was approved by shareholders at the annual
general meeting of the Company held on 4 July 2023. The
cancellation and extinction was sanctioned by the High Court
of England and Wales (the 'High Court'). The effect
of the capital reduction is to create additional distributable
reserves which will be available to the company going forward and
may be used to facilitate returns to shareholders in the future,
whether in the form of dividends, distributions or purchases of the
company's own shares.
The company confirms that,
following the capital reduction, the issued share capital of the
company will be 3,758,151,504 ordinary shares of USD 0.50 nominal
value each, carrying one vote each. There are no shares held in
treasury. The total voting rights in the company therefore will be
3,758,151,504.
Dividend payment timetable
The board has recommended a final
dividend of 3.57 cents for the financial year ended 31 March 2024,
payable on 26 July 2024 to shareholders recorded in the register at
the close of business on 21 June 2024.
Last day to trade shares cum
dividend
19 June 2024
Shares commence trading
ex-dividend
20 June 2024
Record
date
21 June 2024
Last date for currency
election
8 June 2024
Payment
date
26 July 2024
Information on additional
KPIs
An investor relations pack with
information on the additional KPIs and balance sheet is available
to download on our website at airtel.africa/investors
Strategic overview
The Group provides telecoms and
mobile money services in 14 emerging markets of sub-Saharan Africa.
Our markets are characterised by huge geographies with relatively
sparse populations, high population growth rates, high proportions
of youth, low smartphone penetration, low data penetration and
relatively unbanked populations. Unique mobile user penetration
across the Group's footprint is around 48%, and banking penetration
remains under 50%. These indicators illustrate the significant
opportunity still available to Airtel Africa to enhance both
digital and financial inclusion in the communities we serve,
enriching and transforming their lives through digitalisation,
whilst at the same time growing our revenues profitably across each
of our key services of voice, data and mobile money.
The Group continues to invest in
its network and distribution infrastructure to enhance both mobile
connectivity and financial inclusion across our countries of
operation. In particular, we continued to invest in expanding our
4G network footprint to increase data capacity in our networks to
support future business growth, as well as deploying new sites,
especially in rural areas, to enhance coverage and
connectivity.
We describe our 'win with'
strategy through six strategic pillars. Our customers are at the
core of our strategy, through our corporate purpose of transforming
lives.
The digitalisation of our products
and services is fundamental to enabling the success of each pillar
within our 'win with' strategy. In addition, the digitisation of
our internal systems and processes ensures we optimise our
operating flexibility.
Underpinning the Group's business
strategy for growth is our sustainability strategy which supports
our well-established corporate purpose of transforming lives, our
continued commitment to driving sustainable development and acting
as a responsible business. Our sustainability strategy sets out our
goals and commitments to foster financial inclusion, bridge the
digital divide and serve more customers in some of the least
penetrated telecommunication markets in the world.
This year, we continued to make
strong progress across each of our core strategic pillars: 'Win
with technology', 'Win with distribution', 'Win with data', 'Win
with mobile money', 'Win with cost' and 'Win with
people'.
Win with technology
The Group remains focused on
delivering best-in-class services, expanding 4G networks and has
launched new 5G technology in key markets including Kenya, Nigeria,
Tanzania, Uganda and Zambia following the acquisition of 5G
spectrum. Reaching underserved communities is a key priority, and
we continue to: 1) increase rural coverage through new site
rollouts, 2) acquire additional spectrum and 3) invest in new
technology across our markets.
As part of ensuring our services
are future ready, in addition to purchasing spectrum, we grew our
fibre infrastructure and tested our 5G capabilities. After
exploring the potential for additional third-party revenue streams,
we have invested in data centres to further support digital
inclusion across our markets. We continued to strengthen our fibre
business, which is now delivering encouraging revenue growth.
During the year we added a further around 5,000 km of fibre, with a
total of 75,400+ km now deployed.
Furthermore, we expanded our
international data capacity via submarine cables by 100% to 3.1
Tbps with current 45% utilization through a combination of adding
additional routes and capacity.
Overall, the capacity investment
has resulted in a 32.7% increase in data capacity - reaching
31,700+ terabytes (TB) per day, with peak hour data utilization at
53% allowing for increased network resilience and an enriched
service continuity.
Following substantial spectrum
acquisitions in FY'23, we further invested in the renewal of 2100
MHz spectrum in Nigeria during this period. Continued investment
into spectrum across our markets will further enhance network
capacity and coverage.
Win with distribution
We continue to strengthen our
exclusive channel of kiosks/mini-shops and Airtel Money branches
along with multi-brand outlets in both urban and rural markets. We
offer a simplified and enhanced Know Your Customer (KYC) app to
provide a seamless customer onboarding experience. These have
enabled us to add customers, resulting in customer base growth of
9.0%, and supported voice revenue growth of 11.9% in constant
currency.
The Group continued its investment
in strengthening our distribution network infrastructure, with a
focus on rural distribution networks. During the period, the Group
expanded its exclusive franchise stores, adding over 27,800 kiosks
and mini shops (taking the total to almost 89,600 kiosks and mini
shops) and adding 1,550+ Airtel Money branches (AMB), taking the
total to 19,500+ AMBs across our footprint. The Group also added
around 59,600 activating outlets, an increase of 19.6%.
Win with data
With continued investments in the
expansion of our 4G network and launching 5G in several OpCo's, the
clear focus is on enhancing customer experience across the network.
This is not only for mobile users but also for broadband enterprise
users to support continued data ARPU and data revenue
growth.
Expansion of the 4G network and
improved user experience has helped drive increased smartphone
penetration, customer ARPU and consumption per data user across the
segments. Smartphone penetration was up 4.2 percentage points to
40.5% and data customer grew by 17.8%, now representing 42.1% of
our total base. Smartphone data customers grew by 24.7% leading to
higher consumption & ARPU growth.
Data usage per customer per month
also grew by 20.8% and reached 5.4 GB per month from 4.4 GB a year
ago. This increase was led by increased smartphone penetration and
an expansion of our home broadband and enterprise
customers.
All the above contributed to a
29.2% growth in constant currency data revenue. 4G handset users'
data usage constituted 88.3% of total data usage on the network in
Q4'24 growing at 61.3%, with 4G data usage per data customer of
over 8.7GB per month.
Win with mobile
money
The low penetration of traditional
banking services across our footprint leaves a large number of
unbanked customers whose needs can be largely fulfilled through
mobile money services. We aim to drive the uptake of Airtel Money
services in all our markets, harnessing the ability of our
profitable mobile money business model to enhance financial
inclusion in some of the most 'unbanked' populations in the
world.
During the period, we focussed on
growing our ecosystem and driving customer acquisition. We launched
new international money transfer routes, as well as new loan
products and continued to integrate more partners into our
ecosystem.
We continued to expand our
exclusive distribution channel of AMBs and kiosks to ensure
availability of services to customers, even in the rural areas. The
number of kiosks and mini shops increased by 45% and Airtel Money
branches by over 8.7%. Furthermore, our non-exclusive channel of
mobile money agents expanded by 53%, following implementation of
our digital on-boarding journey. Our distribution expansion and
enhanced offerings helped drive 20.7% growth in our mobile money
customer base, now serving 38.0 million customers, which represents
24.9% of our total customer base.
Our Nigeria PSB licence remains an
opportunity for the Group. During this year, we accelerated our
customer acquisition strategy and our customer base is 1.5 million
active customers. We continue to build the ecosystem to grow our
transaction value.
Along with data, mobile money
continues to be one of our fastest growing services, delivering
revenue growth of 32.8% in full year. It is an increasingly
important part of our business, with over $112bn of annual
transaction value in reported currency. Mobile money revenue
accounts for 16.8% of the Group revenues in the period.
Mobile money ARPU increased by
8.6% in constant currency over the period, driven by increased
transaction values and higher contributions from cash transactions,
P2P transfers and mobile services recharges through Airtel
Money.
Win with cost
Despite the impact of inflationary
pressure across the Group and continuing high fuel prices across
countries, our 'win with cost' initiatives have continued to
support margin resilience across the Group.
We continue our focus on enhancing
cost efficiency through changes in the operating design and
response to the macroeconomic changes, an example of which is the
roll out of a majority of new sites using green initiatives (solar,
batteries and grid connection). We embrace robust cost discipline
and continuously seek to improve our processes to reduce operating
costs, delivering one of the highest EBITDA margins in the
industry. We also continue to embrace the latest technology to
optimally design our networks and improve our capital expenditure
efficiency enabling us to build large incremental capacities at
lower marginal cost.
We are undertaking various cost
efficiency initiatives to mitigate the headwinds, relating mainly
to: (i) working with active equipment manufacturers to implement
energy saving features to reduce energy consumption, (ii) working
with tower companies (towercos) to invest more in energy efficient
equipment (including in lithium batteries and solar equipment),
(iii) enhance grid connectivity, (iv) transmission re-routing to
optimise lease line capacity and (v) shift towards digital
recharges, especially through Airtel Money to reduce commission
pay-outs.
Win with people
We continue to operate in a highly
competitive and volatile business landscape and therefore our
ongoing commitment to our employees remains integral to winning
despite operating environment headwinds.
We have developed various
mechanisms to ensure that our employees remain heard, this includes
our engagement survey which is used to measure employee sentiment
on key matters affecting them including engagement, reward, values
and collaboration amongst others. The next engagement survey will
be conducted in July 2024. 81% of employees participated in the
last employee engagement survey, being 2% higher than the previous
survey. In addition to the engagement survey other
mechanisms where we engage with our people meaningfully include one
on one discussions with senior leadership, including when our
leadership visits to our OpCo's. These mechanisms enable us to
identify strength areas, areas of improvement with actionable
insight for improvement and opportunities for continuous
collaboration across our business.
We recognise the importance of
having diverse teams considering the diverse communities we serve
across our 17 operations. Gender diversity remains a key focus area
with 28.3% of women in our workforce (up from 26% in the prior
period), and we had an increase of different nationalities to 43
(from 39 in the prior period). Additional focus on accelerating the
recruitment and promotion by merit of female talent within the
business remains in focus.
Talent capability and capacity has
remained a key focus throughout the year. We focused on updating
our learning content across our online and classroom platforms to
build capability for now and for the future. In addition,
on-the-job training, coaching and leadership, building leadership
capability and functional expertise remains at the heart of our
learning and development programmes.
Through our Executive leadership
development, Africa Mobility and Women for Tech programs, we have
been able to support talent development and retention which
continues to help us build succession planning across critical
roles. These programmes offer exposure and learning opportunities
to our high potential and top performing talent as part of an
accelerated career development programme.
Our high-performance culture
remains true to who we are. This is aligned to our reward
philosophy where 'pay for performance' based on key result areas
which each employee is measured on and consistently strives to meet
and exceed.
We are cognisant that by providing
great work experiences for our people, we are able to drive greater
employee engagement and satisfaction. This in turn leads to
improved performance, innovation and subsequently transformative
experiences for both our employees and in the communities where we
serve.
Financial review for the year ended 31 March
2024
Nigeria - Mobile
services
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Summarised statement
of
operations
|
|
|
|
|
|
|
|
|
|
Revenue
|
$m
|
1,503
|
2,128
|
(29.4%)
|
25.8%
|
266
|
543
|
(51.0%)
|
34.1%
|
Voice revenue
1
|
$m
|
711
|
1,053
|
(32.5%)
|
19.6%
|
124
|
262
|
(52.7%)
|
29.0%
|
Data revenue
|
$m
|
654
|
884
|
(25.9%)
|
32.1%
|
116
|
230
|
(49.6%)
|
38.0%
|
Other revenue
2
|
$m
|
138
|
191
|
(27.9%)
|
30.6%
|
26
|
51
|
(48.5%)
|
43.1%
|
EBITDA
|
$m
|
811
|
1,101
|
(26.3%)
|
30.9%
|
139
|
284
|
(51.1%)
|
32.8%
|
EBITDA margin
|
%
|
54.0%
|
51.7%
|
226
bps
|
209
bps
|
52.2%
|
52.3%
|
(7)
bps
|
(52)
bps
|
Depreciation and
amortisation
|
$m
|
(264)
|
(344)
|
(23.3%)
|
38.2%
|
(41)
|
(97)
|
(57.1%)
|
26.5%
|
Operating profit
|
$m
|
509
|
721
|
(29.4%)
|
25.4%
|
89
|
177
|
(49.7%)
|
36.2%
|
Capex
|
$m
|
252
|
293
|
(13.9%)
|
(13.9%)
|
74
|
126
|
(40.9%)
|
(40.9%)
|
Operating free cash
flow
|
$m
|
559
|
808
|
(30.8%)
|
68.6%
|
65
|
158
|
(59.1%)
|
225.1%
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
Total customer base
|
million
|
50.9
|
48.4
|
5.3%
|
|
50.9
|
48.4
|
5.3%
|
|
Data customer base
|
million
|
27.4
|
23.8
|
14.9%
|
|
27.4
|
23.8
|
14.9%
|
|
Mobile services ARPU
|
$
|
2.5
|
3.8
|
(33.2%)
|
19.0%
|
1.7
|
3.8
|
(53.9%)
|
26.4%
|
(1) Voice revenue includes
inter-segment revenue of $1m in the year ended 31 March 2024 and in
the prior period. Excluding inter-segment revenue, voice revenue
was $710m in year ended 31 March 2024 and $1,052m in the prior
period.
(2) Other revenue includes
inter-segment revenue of $2m in the year ended 31 March 2024 and in
the prior period. Excluding inter-segment revenue, other revenue
was $136m in year ended 31 March 2024 and $189m in the prior
period.
Revenue grew by 25.8% in constant
currency, with growth accelerating to 34.1% in Q4'24 largely driven
by strong data demand. In reported currency, revenues declined by
29.4% to $1,503m on account of the significant devaluation of the
Nigerian naira. The constant currency revenue growth was driven by
both customer base growth of 5.3% and ARPU growth of 19.0%.
Customer base growth in current period was negatively impacted by
barring of customers pursuant to KYC directives by the regulator.
Q4'24 reported currency revenues declined by 51.0% reflecting the
impact of Nigerian naira devaluation during the
period.
Voice revenue grew by 19.6% in
constant currency, driven by both customer base growth of 5.3% and
voice ARPU growth of 13.2%.
Data revenue grew by 32.1% in
constant currency, as a function of both data customer and data
ARPU growth of 14.9% and 14.0%, respectively. Data usage per
customer increased by 25.4% to 6.3 GB per month (from 5.0 GB in the
prior period). Our continued 4G network rollout has resulted in
nearly 100% of all our sites delivering 4G services. Further 235
sites are 5G enabled.
Other revenues grew by 30.6% in
constant currency, contributed by growth in messaging and
value-added services coupled with 32.8% growth in leased line
revenue.
EBITDA of $811m declined by 26.3%
in reported currency, but increased by 30.9% in constant currency.
The EBITDA margin increased by 226 basis points to 54.0%. During
the period, there was a one-time opex benefit of $7m on account of
VAT refunds on tower rentals. Excluding this benefit, the FY'24
EBITDA margin would have increased by 180 basis points. The
increase in EBIDTA margin was primarily due to the growth in
constant currency revenues, supported by continued cost
efficiencies. The Q4'24 EBITDA margin of 52.2% - below the FY'24
EBITDA margin of 54.0% - reflects the recent increase in diesel
costs. Diesel prices have increased significantly in Q4'24 but
remain volatile. If current levels persist, the full impact will be
reflected in future EBITDA margins.
Operating free cash flow was
$559m, up by 68.6% in constant currency, largely due to the strong
EBITDA growth and lower capex in current period.
East Africa - Mobile services 1
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Summarised statement
of
operations
|
|
|
|
|
|
|
|
|
|
Revenue
|
$m
|
1,622
|
1,508
|
7.5%
|
21.5%
|
395
|
380
|
4.2%
|
22.5%
|
Voice revenue
2
|
$m
|
851
|
836
|
1.8%
|
14.8%
|
200
|
204
|
(2.0%)
|
15.0%
|
Data revenue
|
$m
|
621
|
537
|
15.5%
|
31.0%
|
156
|
140
|
11.2%
|
31.0%
|
Other revenue
3
|
$m
|
150
|
135
|
10.6%
|
26.1%
|
39
|
36
|
11.1%
|
31.9%
|
EBITDA
|
$m
|
788
|
755
|
4.3%
|
17.1%
|
185
|
193
|
(4.1%)
|
12.4%
|
EBITDA margin
|
%
|
48.6%
|
50.1%
|
(151)
bps
|
(182)
bps
|
46.7%
|
50.7%
|
(401)
bps
|
(418)
bps
|
Depreciation and
amortisation
|
$m
|
(287)
|
(260)
|
10.6%
|
23.3%
|
(72)
|
(70)
|
2.6%
|
17.5%
|
Operating profit
|
$m
|
452
|
459
|
(1.5%)
|
11.9%
|
101
|
112
|
(9.8%)
|
8.9%
|
Capex
|
$m
|
284
|
256
|
10.9%
|
10.9%
|
107
|
97
|
9.5%
|
9.5%
|
Operating free cash
flow
|
$m
|
504
|
499
|
0.9%
|
20.6%
|
78
|
96
|
(18.2%)
|
15.6%
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
Total customer base
|
million
|
69.4
|
62.7
|
10.7%
|
|
69.4
|
62.7
|
10.7%
|
|
Data customer base
|
million
|
26.6
|
21.9
|
21.5%
|
|
26.6
|
21.9
|
21.5%
|
|
Mobile services ARPU
|
$
|
2.0
|
2.1
|
(2.9%)
|
9.7%
|
1.9
|
2.0
|
(5.9%)
|
10.7%
|
(1) The East Africa business
region includes Kenya, Malawi, Rwanda, Tanzania, Uganda and
Zambia.
(2) Voice revenue includes
inter-segment revenue of $1m in the year ended 31 March 2024 and in
the prior period. Excluding inter-segment revenue, voice revenue
was $850m in year ended 31 March 2024 and $835m in the prior
period.
(3) Other revenue includes
inter-segment revenue of $12m in the year ended 31 March 2024 and
$11m in the prior period. Excluding inter-segment revenue, other
revenue was $138m in year ended 31 March 2024 and $124m in the
prior period.
East Africa revenue grew by 7.5%
in reported currency to $1,622m, and by 21.5% in constant currency.
The constant currency growth was made up of voice revenue growth of
14.8%, data revenue growth of 31.0% and other revenue growth of
26.1%. The differential in growth rates is primarily contributed by
the devaluation in Zambian kwacha, Malawi kwacha and Kenya
shilling.
Voice revenue grew by 14.8% in
constant currency, driven by both customer base growth of 10.7% and
voice ARPU growth of 3.6%. The customer base growth was largely
driven by expansion of both increased network coverage and the
increasing scale of the distribution network. Voice ARPU growth of
3.6% was supported by an increase in voice usage per customer by
6.0% to 407 minutes per customer per month partially offset by the
interconnect rate reduction in Tanzania and Rwanda.
Data revenue grew by 31.0% in
constant currency, largely driven by data customer base growth of
21.5% and data ARPU growth of 4.2%. Our continued investment in the
network and expansion of 4G network infrastructure helped us grow
both the data customer base and usage levels. 96.4% of our East
Africa network sites are now on 4G, compared to 90.4% in the prior
period. Further,799 sites are 5G enabled in four markets. In Q4'24,
total data usage per customer increased to 5.1 GB per customer per
month, up by 20.1%.
EBITDA increased to $788m, up by
4.3% in reported currency and up by 17.1% in constant currency.
EBITDA margin at 48.6%, declined by 151 basis points which was
primarily impacted by rising fuel prices in several of our key
markets, with the biggest impact being witnessed in
Q4'24.
Operating free cash flow was
$504m, up by 20.6% in constant currency, due largely to EBITDA
growth, partially offset by increased capex.
Francophone Africa - Mobile services
1
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Summarised statement
of
operations
|
|
|
|
|
|
|
|
|
|
Revenue
|
$m
|
1,213
|
1,090
|
11.3%
|
9.2%
|
300
|
282
|
6.5%
|
6.0%
|
Voice revenue
2
|
$m
|
622
|
607
|
2.4%
|
0.4%
|
149
|
154
|
(3.3%)
|
(3.7%)
|
Data revenue
|
$m
|
459
|
366
|
25.4%
|
22.9%
|
119
|
98
|
21.8%
|
21.2%
|
Other revenue
3
|
$m
|
132
|
117
|
13.5%
|
12.3%
|
32
|
30
|
6.8%
|
6.7%
|
EBITDA
|
$m
|
512
|
480
|
6.9%
|
4.7%
|
118
|
124
|
(5.1%)
|
(5.8%)
|
EBITDA margin
|
%
|
42.2%
|
44.0%
|
(176)
bps
|
(182)
bps
|
39.2%
|
44.0%
|
(478)
bps
|
(490)
bps
|
Depreciation and
amortisation
|
$m
|
(209)
|
(190)
|
10.4%
|
8.3%
|
(54)
|
(47)
|
14.0%
|
13.6%
|
Operating profit
|
$m
|
255
|
255
|
0.0%
|
(2.0%)
|
51
|
67
|
(23.5%)
|
(24.4%)
|
Capex
|
$m
|
157
|
151
|
3.9%
|
3.9%
|
48
|
57
|
(15.6%)
|
(15.6%)
|
Operating free cash
flow
|
$m
|
355
|
328
|
8.2%
|
5.1%
|
70
|
67
|
4.0%
|
2.3%
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
Total customer base
|
million
|
32.3
|
28.9
|
11.8%
|
|
32.3
|
28.9
|
11.8%
|
|
Data customer base
|
million
|
10.4
|
8.9
|
16.0%
|
|
10.4
|
8.9
|
16.0%
|
|
Mobile services ARPU
|
$
|
3.3
|
3.3
|
(0.6%)
|
(2.4%)
|
3.1
|
3.3
|
(4.9%)
|
(5.3%)
|
(1) The Francophone Africa
business region includes Chad, Democratic Republic of the Congo,
Gabon, Madagascar, Niger, Republic of the Congo, and
Seychelles.
(2) Voice revenue includes
inter-segment revenue of $3m in the year ended 31 March 2024 and in
the prior period. Excluding inter-segment revenue, voice revenue
was $619m in year ended 31 March 2024 and $604m in the prior
period.
(3) Other revenue includes
inter-segment revenue of $3m in the year ended 31 March 2024 and in
the prior period. Excluding inter-segment revenue, other revenue
was $129m in year ended 31 March 2024 and $114m in the prior
period.
Revenue grew by 11.3% in reported
currency and by 9.2% in constant currency. Higher reported currency
growth as compared to constant currency is due to the appreciation
in the Central African franc, partially offset by a devaluation in
the Madagascar ariary.
Voice revenue grew by 0.4% in
constant currency, as customer base growth of 11.8% was partially
offset by a decline in voice ARPU. Voice ARPU was negatively
impacted by an interconnect rate reduction in Congo B and Niger
while the customer base growth was driven by the expansion of both
network coverage and distribution infrastructure.
Data revenue grew by 22.9% in
constant currency, supported by customer base growth of 16.0%.
Increased data usage across the network supported ARPU growth of
2.9%. Our continued 4G network rollout resulted in an increase in
total data usage of 49.1% and per customer data usage increase of
24.8%. For Q4'24, data usage per customer increased to 4.6 GB per
month (up from 3.8 GB in the prior period).
EBITDA at $512m, increased by 6.9%
and 4.7% in reported and constant currency, respectively. The
EBITDA margin declined to 42.2%, a decline of 182 basis points in
constant currency. The EBITDA margin decline was mainly due to a
one-time opex benefit of $19m in the prior period. The EBITDA
margin in Q4'24 was impacted by an increase in fixed frequency fees
in a key market combined with a slowdown in revenue growth in key
markets.
Operating free cash flow was
$355m, increased by 5.1% in constant currency, due to the increased
EBITDA, partially offset by increased capex.
Mobile services
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Summarised statement of
operations
|
|
|
|
|
|
|
|
|
|
Revenue 1
|
$m
|
4,338
|
4,721
|
(8.1%)
|
19.4%
|
962
|
1,205
|
(20.2%)
|
21.5%
|
Voice revenue
|
$m
|
2,179
|
2,491
|
(12.5%)
|
11.9%
|
472
|
619
|
(23.8%)
|
13.7%
|
Data revenue
|
$m
|
1,734
|
1,787
|
(3.0%)
|
29.2%
|
391
|
469
|
(16.5%)
|
31.1%
|
Other revenue
|
$m
|
425
|
443
|
(4.1%)
|
23.5%
|
99
|
117
|
(16.1%)
|
25.8%
|
EBITDA
|
$m
|
2,115
|
2,336
|
(9.5%)
|
18.8%
|
443
|
602
|
(26.5%)
|
14.8%
|
EBITDA margin
|
%
|
48.8%
|
49.5%
|
(73)
bps
|
(26)
bps
|
46.0%
|
50.0%
|
(397)
bps
|
(273)
bps
|
Depreciation and
amortisation
|
$m
|
(760)
|
(794)
|
(4.2%)
|
23.4%
|
(166)
|
(213)
|
(21.9%)
|
19.6%
|
Operating profit
|
$m
|
1,219
|
1,435
|
(15.0%)
|
14.0%
|
243
|
358
|
(32.2%)
|
11.0%
|
Capex
|
$m
|
693
|
700
|
(1.0%)
|
(1.0%)
|
229
|
280
|
(18.2%)
|
(18.2%)
|
Operating free cash
flow
|
$m
|
1,422
|
1,636
|
(13.1%)
|
30.9%
|
214
|
322
|
(33.6%)
|
59.3%
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
Mobile voice
|
|
|
|
|
|
|
|
|
|
Customer base
|
million
|
152.7
|
140.0
|
9.0%
|
|
152.7
|
140.0
|
9.0%
|
|
Voice ARPU
|
$
|
1.2
|
1.5
|
(19.9%)
|
2.4%
|
1.0
|
1.5
|
(30.3%)
|
4.0%
|
Mobile data
|
|
|
|
|
|
|
|
|
|
Data customer base
|
million
|
64.4
|
54.6
|
17.8%
|
|
64.4
|
54.6
|
17.8%
|
|
Data ARPU
|
$
|
2.4
|
3.0
|
(19.4%)
|
7.3%
|
2.1
|
2.9
|
(30.0%)
|
9.9%
|
(1) Mobile service
revenue after inter-segment eliminations was $4,330m in the year
ended 31 March 2024 and $4,715m in the prior period.
Overall revenue from mobile
services declined by 8.1% in reported currency with growth of 19.4%
in constant currency. The constant currency growth was evident
across all regions and services. Mobile services revenue grew in
Nigeria by 25.8%, in East Africa by 21.5% and in Francophone Africa
by 9.2%, respectively.
Voice revenue grew by 11.9% in
constant currency, supported by both customer base growth of 9.0%
and voice ARPU growth of 2.4%. Customer base growth was driven by
the expansion of our network and distribution infrastructure. The
voice ARPU growth of 2.4% was supported by an increase in voice
usage per customer of 5.2%, reaching 286 minutes per customer per
month, with total minutes on the network increasing by
14.9%.
Data revenue grew by 29.2% in
constant currency, driven by both customer base growth of 17.8% and
data ARPU growth of 7.3%. The customer base growth was recorded
across all the regions supported by the expansion of our 4G
network. 95.0% of our total sites are now on 4G, compared with
90.3% in the prior period. 5G is operational across five countries,
with 1,034 sites deployed. In Q4'24, data usage per customer
increased to 5.7 GB per customer per month (from 4.6 GB in the
prior period). In the full year ended 31 March 2023, data revenue
contributed to 40.0% of total mobile services revenue, up from
37.8% in the prior period.
EBITDA was $2,115m, declined 9.5%
in reported currency and up by 18.8% in constant currency. The
EBITDA margin declined by 73 basis points to 48.8%, a decline of 26
basis points in constant currency.
Operating free cash flow was
$1,422m, up by 30.9% in constant currency, due to the increased
EBITDA.
Mobile money
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Summarised statement of
operations
|
|
|
|
|
|
|
|
|
|
Revenue 1
|
$m
|
837
|
692
|
21.1%
|
32.8%
|
206
|
176
|
17.0%
|
35.5%
|
Nigeria
|
$m
|
2
|
0
|
-
|
-
|
0
|
0
|
-
|
-
|
East Africa
|
$m
|
635
|
531
|
19.8%
|
36.0%
|
154
|
135
|
14.1%
|
38.2%
|
Francophone Africa
|
$m
|
200
|
161
|
24.3%
|
22.3%
|
52
|
41
|
26.4%
|
25.9%
|
EBITDA
|
$m
|
436
|
344
|
26.8%
|
39.0%
|
109
|
88
|
24.4%
|
43.5%
|
EBITDA margin
|
%
|
52.1%
|
49.8%
|
236
bps
|
234
bps
|
52.9%
|
49.8%
|
315
bps
|
294
bps
|
Depreciation and
amortisation
|
$m
|
(18)
|
(17)
|
6.0%
|
22.7%
|
(4)
|
(5)
|
(11.7%)
|
11.3%
|
Operating profit
|
$m
|
405
|
318
|
27.6%
|
39.5%
|
102
|
81
|
26.5%
|
45.6%
|
Capex
|
$m
|
27
|
33
|
(19.5%)
|
(19.5%)
|
10
|
7
|
41.9%
|
41.9%
|
Operating free cash
flow
|
$m
|
409
|
311
|
31.6%
|
45.6%
|
99
|
81
|
23.0%
|
43.7%
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
Mobile money customer
base
|
million
|
38.0
|
31.5
|
20.7%
|
|
38.0
|
31.5
|
20.7%
|
|
Transaction value
|
$bn
|
112.3
|
88.6
|
26.8%
|
38.2%
|
27.7
|
24.3
|
14.1%
|
30.2%
|
Mobile money ARPU
|
$
|
2.0
|
2.0
|
(0.9%)
|
8.6%
|
1.8
|
1.9
|
(2.9%)
|
12.5%
|
(1)
Mobile money service revenue post inter-segment eliminations with mobile services was
$649m in the year ended 31 March 2024 and $540m in the prior
year.
Mobile money revenue grew by 21.1%
in reported currency, with constant currency growth of 32.8%
accelerating to 35.5% in Q4'24. The differential in growth rates is
primarily as the result of devaluation in Zambian kwacha and Malawi
kwacha, partially offset by appreciation in Central African franc.
The constant currency mobile money revenue growth was driven by
revenue growth in both East Africa and Francophone Africa of 36.0%
and 22.3%, respectively. In Nigeria, Company was focussed on
customer acquisition through the year with 1.5 million of active
customers registered for mobile money services in Nigeria at the
end of March 2024. Annualised transaction value for Nigeria
SmartCash grew by 15% in the current quarter as compared to quarter
ended December 2023. Additionally, we added almost 39,000 agents
during the quarter reaching almost 205,000 agents as of 31 March
2024.
The constant currency revenue
growth of 32.8% was driven by both our customer base growth of
20.7% and mobile money ARPU growth of 8.6%. The expansion of our
distribution network, particularly our exclusive channels of Airtel
Money branches and kiosks, supported customer base growth of 20.7%.
The mobile money ARPU growth of 8.6% was driven by transaction
value per customer growth of 13.1% in constant currency, to $262
per customer per month.
Annual transaction value amounted
to over $112bn in reported currency, with mobile money revenue
contributing 16.8% of total Group revenue during the full year
period ending 31 March 2024.
EBITDA was $436m, up by 26.8% and
39.0% in reported and constant currency, respectively. The EBITDA
margin reached 52.1%, an improvement of 234 basis points in
constant currency and 236 basis points in reported currency, driven
by continued operating leverage.
Regional performance
Nigeria
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Revenue
|
$m
|
1,504
|
2,128
|
(29.3%)
|
25.9%
|
266
|
543
|
(51.0%)
|
34.2%
|
Voice revenue
|
$m
|
711
|
1,053
|
(32.5%)
|
19.6%
|
124
|
262
|
(52.7%)
|
29.0%
|
Data revenue
|
$m
|
654
|
884
|
(25.9%)
|
32.1%
|
116
|
230
|
(49.6%)
|
38.0%
|
Mobile money revenue
|
$m
|
2
|
0
|
-
|
-
|
0
|
0
|
-
|
-
|
Other revenue
|
$m
|
138
|
191
|
(27.9%)
|
30.6%
|
26
|
51
|
(48.5%)
|
43.1%
|
EBITDA
|
$m
|
805
|
1,093
|
(26.3%)
|
30.8%
|
138
|
281
|
(51.0%)
|
33.0%
|
EBITDA margin
|
%
|
53.5%
|
51.4%
|
218
bps
|
202
bps
|
51.8%
|
51.8%
|
(3)
bps
|
(48)
bps
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
ARPU
|
$
|
2.5
|
3.8
|
(33.1%)
|
19.1%
|
1.7
|
3.8
|
(53.8%)
|
26.4%
|
East Africa
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Revenue
|
$m
|
2,125
|
1,931
|
10.1%
|
24.6%
|
516
|
487
|
5.9%
|
25.5%
|
Voice revenue
|
$m
|
851
|
836
|
1.8%
|
14.8%
|
200
|
204
|
(2.0%)
|
15.0%
|
Data revenue
|
$m
|
621
|
537
|
15.5%
|
31.0%
|
156
|
140
|
11.2%
|
30.9%
|
Mobile money revenue
|
$m
|
635
|
530
|
19.9%
|
36.0%
|
154
|
135
|
14.1%
|
38.2%
|
Other revenue
|
$m
|
145
|
131
|
10.2%
|
25.9%
|
38
|
34
|
11.3%
|
31.9%
|
EBITDA
|
$m
|
1,134
|
1,032
|
9.8%
|
23.8%
|
270
|
264
|
2.4%
|
21.5%
|
EBITDA margin
|
%
|
53.3%
|
53.5%
|
(13)
bps
|
(31)
bps
|
52.3%
|
54.1%
|
(179)
bps
|
(172)
bps
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
ARPU
|
$
|
2.6
|
2.7
|
(0.6%)
|
12.4%
|
2.5
|
2.6
|
(4.3%)
|
13.4%
|
Francophone Africa
Description
|
Unit of
measure
|
Year ended
|
Quarter ended
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Mar-24
|
Mar-23
|
Reported
currency
change
|
Constant
currency
change
|
Revenue
|
$m
|
1,350
|
1,201
|
12.4%
|
10.3%
|
336
|
310
|
8.4%
|
7.9%
|
Voice revenue
|
$m
|
622
|
607
|
2.4%
|
0.4%
|
149
|
154
|
(3.3%)
|
(3.7%)
|
Data revenue
|
$m
|
459
|
366
|
25.4%
|
22.9%
|
119
|
98
|
21.8%
|
21.3%
|
Mobile money revenue
|
$m
|
200
|
161
|
24.3%
|
22.3%
|
52
|
41
|
26.4%
|
25.9%
|
Other revenue
|
$m
|
131
|
115
|
13.6%
|
12.2%
|
32
|
30
|
6.6%
|
6.4%
|
EBITDA
|
$m
|
620
|
563
|
10.2%
|
8.1%
|
146
|
145
|
0.2%
|
(0.5%)
|
EBITDA margin
|
%
|
46.0%
|
46.9%
|
(93)
bps
|
(97)
bps
|
43.4%
|
46.9%
|
(355)
bps
|
(366)
bps
|
Operating
KPIs
|
|
|
|
|
|
|
|
|
|
ARPU
|
$
|
3.7
|
3.7
|
0.4%
|
(1.4%)
|
3.5
|
3.6
|
(3.2%)
|
(3.6%)
|
Consolidated performance
Description
|
UoM
|
Year ended - March
2024
|
Year ended - March
2023
|
Mobile
services
|
Mobile
money
|
Unallocated
|
Eliminations
|
Total
|
Mobile
services
|
Mobile
money
|
Unallocated
|
Eliminations
|
Total
|
Revenue
|
$m
|
4,338
|
837
|
-
|
(196)
|
4,979
|
4,721
|
692
|
-
|
(158)
|
5,255
|
Voice revenue
|
$m
|
2,179
|
|
-
|
-
|
2,179
|
2,491
|
|
-
|
-
|
2,491
|
Data revenue
|
$m
|
1,734
|
|
-
|
-
|
1,734
|
1,787
|
|
-
|
-
|
1,787
|
Other revenue
|
$m
|
425
|
|
-
|
(8)
|
417
|
443
|
|
-
|
(6)
|
437
|
EBITDA
|
$m
|
2,115
|
436
|
(123)
|
-
|
2,428
|
2,336
|
344
|
(105)
|
-
|
2,575
|
EBITDA margin
|
%
|
48.8%
|
52.1%
|
|
|
48.8%
|
49.5%
|
49.8%
|
|
|
49.0%
|
Depreciation and
amortisation
|
$m
|
(760)
|
(18)
|
(10)
|
-
|
(788)
|
(794)
|
(17)
|
(7)
|
-
|
(818)
|
Operating
profit
|
$m
|
1,219
|
405
|
16
|
-
|
1,640
|
1,435
|
318
|
4
|
-
|
1,757
|
Risk factors
The Group's business and industry
in which it operates together with all other information contained
in this document, including, in particular, the risk factors
summarised below. Additional risks and uncertainties relating to
the Group that are currently unknown to the Group, or those the
Group currently deems immaterial, may, individually or
cumulatively, also have a material adverse impact on the Group's
business, results of operations and financial position.
Summary of principal risks
The Group continually monitors its
external and internal environment
to identify risks which have the ability to
impact its operations or the achievement of its objectives. This
year, the Group principal risks now reflect risks related to
geo-political uncertainties and adverse macro-economic
environments.
1. We operate in
a competitive environment with the potential for aggressive
competition by existing players, or the entry of new players, which
could both put a downward pressure on prices, adversely affecting
our revenue and profitability.
2. Failure to
innovate through simplifying the customer experience, developing
adequate digital touchpoints in line with changing customer needs
and competitive landscape could lead to loss of customers and
market share.
3. Global
geopolitical and regional tensions have the potential to impact our
business directly and indirectly due to the interconnectedness of
the global supply chain. Relatedly, adverse macroeconomic
conditions such as rising inflation and increased cost of living
not only puts pressure on the disposable income of our customers
but also increases the cost of inputs for our business negatively
impacting sales and profitability.
4. Cybersecurity
threats through internal or external sabotage or system
vulnerabilities could potentially result in customer data breaches
and/or service downtimes.
5. Adverse
changes in our external business environment and macro-economic
conditions such as supply chain disruptions, increase in global
commodity prices and inflationary pressures could lead to a
significant increase in our operating cost structure while also
negatively impacting the disposable income of consumers. These
adverse economic conditions therefore not only put pressure on our
profitability but also on customer usage for our
services.
6. Shortages of
skilled telecommunications professionals in some markets and the
inability to identify and develop successors for key leadership
positions could both lead to disruptions in the execution of our
corporate strategy.
7. Our internal
control environment is subject to the risk that controls may become
inadequate due to changes in internal or external conditions, new
accounting requirements, delays, or inaccuracies in
reporting.
8. Our ability
to provide quality of service to our customers and meet quality of
service (QoS) requirements depends on the robustness and resilience
of our technology stack and ecosystem encompassing hardware,
software, products, services, and applications and our ability to
respond appropriately to any disruptions. However,
telecommunications networks are subject to the risks of technical
failures, aging infrastructure, human error, wilful acts of
destruction or natural disasters.
9. We operate in
a diverse and dynamic legal, tax and regulatory environment.
Adverse changes in the political, macro-economic and policy
environment could have a negative impact on our ability to achieve
our strategy. While the group makes every effort to comply with its
legal and regulatory obligations in all its operating jurisdictions
in line with the group's risk appetite, we are however continually
faced with an uncertain and constantly evolving legal, regulatory,
and policy environment in some of the markets where we
operate.
10. Our multinational footprint means we are constantly exposed
to the risk of adverse currency fluctuations and the macroeconomic
conditions in the markets where we operate. We derive revenue and
incur costs in local currencies where we operate, but we also incur
costs in foreign currencies, mainly from buying equipment and
services from manufacturers and technology service providers. That
means adverse movements in exchange rates between the currencies in
our OpCos and the US dollar could have a negative effect on our
liquidity and financial condition. In some markets, we face
instances of limited supply of foreign currency within the local
monetary system. This not only constrains our ability to fully
benefit at Group level from strong cash generation by those OpCos
but also impacts our ability to make timely foreign currency
payments to our international suppliers.
Given the severity of this risk,
specifically in some of our OpCos, the Group management
continuously monitors the potential impact of this risk of exchange
rate fluctuations based on the following methodology:
a) Comparing the
average devaluation of each currency in the markets in which the
Group operates against US dollar on 3-year and 5-year historic
basis and onshore forward exchange rates over a 1-year
period.
b) If either of
the above devaluation is higher than 5% per annum, management
selects the highest of these exchange rates.
c) Management
then uses this exchange rate to monitor the potential impact of
using such rate on the Group's income statement so that the Group
can actively monitor and assess the impact on the Group's
financials due to exchange rate fluctuations.
Additionally, for our Nigerian
operations, management uses different sensitivity analysis for
scenario planning purposes which include the impact of the
devaluation from the recent changes to the
operations in the Nigerian Foreign Exchange (FX) market.
With respect to currency
devaluation sensitivity going forward, on a 12-month basis assuming
that the USD appreciation occurs at the beginning of the period, a
further 1% USD appreciation across all currencies in our OpCos
would have a negative impact of $45m - $47m on revenues, $21m -
$22m on EBITDA and $21m - $23m on foreign exchange loss (excluding
derivatives). Our largest exposure is to the Nigerian naira, for
which on a similar basis, a further 1% USD appreciation would have
a negative impact of $10m - $11m on revenues, $5m - $6m on EBITDA
and $8.5m - $10.5m on foreign exchange loss (excluding
derivatives).
This does not represent any
guidance and is being used solely to illustrate the potential
impact of further currency devaluation on the Group for the purpose
of exchange rate risk management. The accounting under IFRS is
based on exchange rates in line with the requirements of IAS 21
'The Effect of Changes in Foreign Exchange' and does not factor in
the devaluation mentioned above.
Based on above-mentioned specific
methodology for the identified OpCos, management evaluates specific
mitigation actions based on available mechanisms in each of the
geographies. For further details on such mitigation action, refer
to the risk section of the Annual Report and Accounts
2022/23.
Forward looking statements
This document contains certain
forward-looking statements regarding our intentions, beliefs or
current expectations concerning, amongst other things, our results
of operations, financial condition, liquidity, prospects, growth,
strategies and the economic and business circumstances occurring
from time to time in the countries and markets in which the Group
operates.
These statements are often, but
not always, made through the use of words or phrases such as
"believe," "anticipate," "could," "may," "would," "should,"
"intend," "plan," "potential," "predict," "will," "expect,"
"estimate," "project," "positioned," "strategy," "outlook",
"target" and similar expressions.
It is believed that the
expectations reflected in this document are reasonable, but they
may be affected by a wide range of variables that could cause
actual results to differ materially from those currently
anticipated.
All such forward-looking
statements involve estimates and assumptions that are subject to
risks, uncertainties and other factors that could cause actual
future financial condition, performance and results to differ
materially from the plans, goals, expectations and results
expressed in the forward-looking statements and other financial
and/or statistical data within this communication.
Among the key factors that could
cause actual results to differ materially from those projected in
the forward-looking statements are uncertainties related to the
following: the impact of competition from illicit trade; the impact
of adverse domestic or international legislation and regulation;
changes in domestic or international tax laws and rates; adverse
litigation and dispute outcomes and the effect of such outcomes on
Airtel Africa's financial condition; changes or differences in
domestic or international economic or political conditions; the
ability to obtain price increases and the impact of price increases
on consumer affordability thresholds; adverse decisions by domestic
or international regulatory bodies; the impact of market size
reduction and consumer down-trading; translational and
transactional foreign exchange rate exposure; the impact of serious
injury, illness or death in the workplace; the ability to maintain
credit ratings; the ability to develop, produce or market new
alternative products and to do so profitably; the ability to
effectively implement strategic initiatives and actions taken to
increase sales growth; the ability to enhance cash generation and
pay dividends and changes in the market position, businesses,
financial condition, results of operations or prospects of Airtel
Africa.
Past performance is no guide to
future performance and persons needing advice should consult an
independent financial adviser. The forward-looking statements
contained in this document reflect the knowledge and information
available to Airtel Africa at the date of preparation of this
document and Airtel Africa undertakes no obligation to update or
revise these forward-looking statements, whether as a result of new
information, future events or otherwise. Readers are cautioned not
to place undue reliance on such forward-looking
statements.
No statement in this communication
is intended to be, nor should be construed as, a profit forecast or
a profit estimate and no statement in this communication should be
interpreted to mean that earnings per share of Airtel Africa plc
for the current or any future financial periods would necessarily
match, exceed or be lower than the historical published earnings
per share of Airtel Africa plc.
Financial data included in this
document are presented in US dollars rounded to the nearest
million. Therefore, discrepancies in the tables between totals and
the sums of the amounts listed may occur due to such rounding. The
percentages included in the tables throughout the document are
based on numbers calculated to the nearest $1,000 and therefore
minor rounding differences may result in the tables. Growth metrics
are provided on a constant currency basis unless otherwise stated.
The Group has presented certain financial information on a constant
currency basis. This is calculated by translating the results for
the current financial year and prior financial year at a fixed
'constant currency' exchange rate, which is done to measure the
organic performance of the Group. Growth rates for our reporting
regions and service segments are provided in constant currency as
this better represents the performance of the business.
Airtel Africa plc
Results for the year ended 31 March 2024
Consolidated Financial Statements
Consolidated Statement of Comprehensive
Income
(All amounts are in US$ millions unless stated
otherwise)
|
Notes
|
For the year
ended
|
|
|
31 March
2024
|
31 March
2023
|
|
Income
|
|
|
|
|
Revenue
|
5
|
4,979
|
5,255
|
|
Other income
|
|
21
|
13
|
|
|
|
5,000
|
5,268
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
Network operating expenses
|
|
926
|
1,027
|
|
Access charges
|
|
314
|
410
|
|
License fee and spectrum usage charges
|
|
244
|
241
|
|
Employee benefits expense
|
|
301
|
287
|
|
Sales and marketing expenses
|
|
576
|
521
|
|
Impairment loss on financial assets
|
|
5
|
14
|
|
Other operating expenses
|
|
206
|
193
|
|
Depreciation and amortisation
|
|
788
|
818
|
|
|
|
3,360
|
3,511
|
|
|
|
|
|
|
Operating profit
|
|
1,640
|
1,757
|
|
|
|
|
|
|
Finance costs
|
|
|
|
|
- Derivative and foreign exchange
losses
|
|
|
|
|
Nigerian naira
|
|
1,070
|
224
|
|
Other currencies
|
|
189
|
114
|
|
- Other finance costs
|
|
482
|
414
|
|
Finance income
|
|
(38)
|
(29)
|
|
Share of profit of associate and
joint venture accounted for
using equity method
|
|
(0)
|
(0)
|
|
(Loss)/profit before tax
|
|
(63)
|
1,034
|
|
|
|
|
|
|
Income tax expense
|
7
|
26
|
284
|
|
(Loss)/profit for the year
|
|
(89)
|
750
|
|
|
|
|
|
|
(Loss)/profit before tax (as presented
above)
|
|
(63)
|
1,034
|
|
Add: Exceptional items
|
6
|
807
|
-
|
|
Underlying profit before tax
|
|
744
|
1,034
|
|
|
|
|
|
|
(Loss)/profit after tax (as presented
above)
|
|
(89)
|
750
|
|
Add/(Less): Exceptional
items
|
6
|
549
|
(161)
|
|
Underlying profit after tax
|
|
460
|
589
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes
|
For the year
ended
|
|
|
31 March
2024
|
31 March
2023
|
|
|
|
|
|
|
(Loss)/profit for the year (continued from previous
page)
|
|
(89)
|
750
|
|
Other comprehensive income ('OCI')
|
|
|
|
|
Items to be reclassified subsequently to profit or
loss:
|
|
|
|
|
Loss due to foreign
currency translation differences
|
|
(1,175)
|
(350)
|
|
Gain on debt instruments at fair
value through other comprehensive
|
|
0
|
-
|
Tax on above
Share of OCI of
associate and joint venture accounted for
using equity method
|
|
2
(0)
|
(3)
-
|
|
|
|
(1,173)
|
(353)
|
|
Items not to be reclassified subsequently to profit or
loss:
|
|
|
|
|
Re-measurement gain/(loss) on defined benefit plans
|
|
0
|
(0)
|
|
Tax
on above
|
|
(0)
|
0
|
|
|
|
(0)
|
0
|
|
|
|
|
|
|
Other comprehensive loss for the year
|
|
(1,173)
|
(353)
|
|
|
|
|
|
|
Total comprehensive (loss)/income for the
year
|
|
(1,262)
|
397
|
|
|
|
|
|
|
(Loss)/profit for the year
attributable to:
|
|
(89)
|
750
|
|
|
|
|
|
|
Owners of the
company
|
|
(165)
|
663
|
|
Non-controlling
interests
|
|
76
|
87
|
|
|
|
|
|
|
Other comprehensive loss for the year attributable
to:
|
|
(1,173)
|
(353)
|
|
|
|
|
|
|
Owners of the
company
|
|
(1,141)
|
(341)
|
|
Non-controlling
interests
|
|
(32)
|
(12)
|
|
|
|
|
|
|
Total comprehensive (loss)/income for the year
attributable to:
|
|
(1,262)
|
397
|
|
|
|
|
|
|
Owners of the
company
|
|
(1,306)
|
322
|
|
Non-controlling
interests
|
|
44
|
75
|
|
|
|
|
|
|
(Loss)/earnings per share
|
|
|
|
|
Basic
|
8
|
(4.4
cents)
|
17.7
cents
|
|
Diluted
|
8
|
(4.4
cents)
|
17.7
cents
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Statement Flows
(All amounts are in US$ millions unless stated
otherwise)
|
For the year ended
|
|
|
31 March
2024
|
31 March
2023
|
Cash flows from operating activities
|
|
|
Profit before tax
|
(63)
|
1,034
|
Adjustments for
-
|
|
|
Depreciation and amortization
|
788
|
818
|
Finance
income
|
(38)
|
(29)
|
Finance
costs
|
|
|
- Derivative and
foreign exchange losses
|
|
|
Nigerian naira
|
1,070
|
224
|
Other currencies
|
189
|
114
|
- Other finance
costs
|
482
|
414
|
Share of
profit of associate and joint venture accounted for using equity
method
|
(0)
|
(0)
|
Other
non-cash adjustments(1)
|
0
|
2
|
Operating cash flow before changes in working
capital
|
2,428
|
2,577
|
Changes in working capital
|
|
|
Increase
in trade receivables
|
(79)
|
(45)
|
Increase
in inventories
|
(16)
|
(13)
|
Increase
in trade payables
|
56
|
9
|
Increase
in mobile money wallet balance
|
207
|
120
|
Increase/(decrease) in provisions
|
3
|
(32)
|
Increase
in deferred revenue
|
21
|
37
|
Increase
in other financial and non-financial liabilities
|
76
|
113
|
Increase
in other financial and non-financial assets
|
(93)
|
(140)
|
Net cash generated from operations before
tax
|
2,603
|
2,626
|
Income
taxes paid
|
(344)
|
(397)
|
|
|
|
Net cash generated from operating activities
(a)
|
2,259
|
2,229
|
|
|
|
Cash flows from investing activities
|
|
|
Purchase
of property, plant and equipment and capital
work-in-progress
|
(868)
|
(779)
|
Purchase of intangible assets and intangible
assets under development
|
(161)
|
(502)
|
Purchase of other short term
investments
|
(2)
|
-
|
Maturity
of deposits with bank
|
731
|
350
|
Investment in deposits with bank
|
(961)
|
(126)
|
Investment in joint venture
|
-
|
(0)
|
Dividend received from associate
|
-
|
2
|
Interest
received
|
33
|
29
|
Net cash used in investing activities (b)
|
(1,228)
|
(1,026)
|
|
|
|
Cash flows from financing activities
|
|
|
Purchase of shares under buy-back programme
|
(9)
|
-
|
Purchase
of own shares by ESOP trust
|
(2)
|
(8)
|
Proceeds
from sale of shares to NCI
|
53
|
-
|
Proceeds
from borrowings
|
713
|
906
|
Repayment
of borrowings
|
(550)
|
(1,018)
|
Repayment
of lease liabilities
|
(324)
|
(279)
|
Dividend
paid to non-controlling interests
|
(59)
|
(75)
|
Dividend
paid to owners of the company
|
(212)
|
(195)
|
Payment
of deferred spectrum liability
|
(21)
|
(21)
|
Interest
on borrowings, lease liabilities and other liabilities
|
(440)
|
(400)
|
Inflow/(outflow) on maturity of
derivatives (net)
|
7
|
(49)
|
Net cash used in financing activities (c)
|
(844)
|
(1,139)
|
|
|
|
Increase in cash and cash equivalents during the year
(a+b+c)
|
187
|
64
|
Currency translation differences
relating to cash and cash equivalents
|
(128)
|
(70)
|
|
|
|
Cash and cash equivalent as at
beginning of the year
|
841
|
847
|
Cash and cash equivalents as at end of the year (refer to
Note 12) (2)
|
900
|
841
|
|
|
|
|
|
|
(1) For the year ended 31 March 2024 and 31 March 2023, this
mainly includes movements in impairment of trade receivable and
other provisions.
(2) Includes balances held under mobile money trust of
$737m (March 2023:
$616m) on behalf of mobile money customers which are not available
for use by the Group.
Notes to Consolidated Financial Statements
(All amounts are in US$ millions unless stated
otherwise)
1. Corporate
information
Airtel Africa plc ('the company')
is a public company limited by shares incorporated and domiciled in
the United Kingdom (UK) under the Companies Act 2006 and is
registered in England and Wales (registration number 11462215). The
registered address of the company is First Floor, 53/54 Grosvenor
Street, London, W1K 3HU, United Kingdom. The company is listed both
on the London Stock Exchange (LSE) and Nigerian Stock Exchange
(NGX). The company is a subsidiary of Airtel Africa Mauritius
Limited ('the parent'), a company registered in Mauritius. The
registered address of the parent is c/o IQ EQ Corporate Services
(Mauritius) Ltd., 33, Edith Cavell Street, Port Louis, 11324,
Mauritius.
The company, together with its
subsidiary undertakings (hereinafter referred to as 'the Group')
has operations in Africa. The principal activities of the Group,
its associate and its joint venture primarily consist of the
provision of telecommunications and mobile money
services.
2. Basis of preparation
The results for the year ended 31
March 2024 are an abridged statement of the full annual report
which was approved by the Board of Directors and signed on its
behalf on 08 May 2024. The consolidated financial statements within
the full annual report are prepared in accordance with the
requirements of the Companies Act 2006 and International Financial
Reporting Standards as issued by the International Accounting
Standards Board (IASB) and approved for use in the United Kingdom
(UK) by the UK Accounting Standards Endorsement Board
(UKEB).
The financial information set out
above does not constitute the company's statutory accounts for the
years ended 31 March 2024 and 2023, but is derived from those
accounts. Statutory accounts for March 2023 have been delivered to
the Registrar of Companies and those for 2024 will be delivered
following the company's annual general meeting.
The financial information included
in this release announcement does not itself contain sufficient
information to comply with IFRS. The company will publish full
financial statements that comply with IFRS, in June
2024.
All the amounts included in the
financial statements are reported in United States dollars, with
all values rounded to the nearest millions ($m) except when
otherwise indicated. Further, amounts which are less than half a
million are appearing as '0'.
The accounting policies as set out
in the following paragraphs of this note have been consistently
applied by all the Group entities to all the periods presented in
these financial statements. During the year, the Group has changed
the classification of distribution costs relating to its mobile
money business to better reflect the nature of these costs,
reclassifying costs previously included in other operating expenses
to the sales and marketing expenses in the consolidated statement
of comprehensive income.
3. Going concern
These consolidated financial
statements have been prepared on a going concern basis. In making
this going concern assessment, the Group has considered cash flow
projections (including scheduled bond repayment of $550m in May
2024 and repayment of other loans due for repayment in the going
concern period) to June 2025 (going concern assessment period)
under both a base case and reasonable worst-case scenarios
including a reverse stress test. This assessment takes into
consideration its principal risks and uncertainties including a
reduction in revenue and EBITDA and a devaluation of the various
currencies in the countries in which the Group operates including
the Nigerian naira. As part of this evaluation, the Group has
considered available ways to mitigate these risks and uncertainties
and has also considered committed undrawn facilities of $351m
expiring beyond the going concern assessment period, which will
fulfil the Group's cash flow requirement under both the base and
reasonable worst-case scenarios.
Having considered all the
above-mentioned factors impacting the Group's businesses, the
impact of downside sensitivities, and the mitigating actions
available to the group including a reduction and deferral of
capital expenditure, the directors are satisfied that the Group has
adequate resources to continue its operational existence for the
foreseeable future. Accordingly, the directors continue to adopt
the going concern basis of accounting in preparing the consolidated
financial statements.
4. Significant transactions/new
developments
a) On 10
May 2023, the directors recommended, and shareholders approved on
04 July 2023, a final dividend of 3.27 cents per ordinary share for
the year ended 31 March 2023, which was paid on 26 July 2023 to the
holders of ordinary shares on the register of members at the close
of business on 23 June 2023.
An interim dividend of 2.38 cents
per share was also approved by the Board on 29 October 2023, which
has been paid on 15 December 2023.
b) In June 2023,
the Central Bank of Nigeria (CBN) announced changes to the
operations in the Nigerian Foreign Exchange Market, including the
abolishment of segmentation, with all segments now collapsing into
the Investors and Exporters (I&E) window and the reintroduction
of the 'Willing Buyer, Willing Seller' model at the I&E window.
As a result of this CBN
decision, the Nigerian naira devalued against the US dollar by
approximately 62% (USD appreciation of 38%) in the month of June
2023 where the exchange rate moved to 752 naira per USD as against
the opening rate of 465 naira per USD.
The after-effects of the CBN
announcement continued to impact the exchange rate materially
during January 2024 when the Nigerian naira to the US dollar moved
to 1,414 per USD which was also above the threshold percentage as
per Group's exceptional item policy. Over February and March 2024,
the Nigeria naira to US dollar moved back to close at 1,303 per USD
which was in effect a part reversal of the losses seen in January
2024.
This resulted in a material impact
on the Group's financial results arising from the translation of
monetary items at closing exchange rates leading to material
derivative and foreign exchange losses. During the year, the
devaluation of Nigerian naira has resulted in derivative and
foreign exchange losses of $1,070m.
In line with the Group's policy on
exceptional items and alternative performance measures as described
in 'Note on exceptional items' on page 55, the impact of the
devaluation pertaining to the months of June 2023 and January to
March 2024 meet the criteria to be presented as exceptional as per
the Group's exceptional item policy and is of such size, nature and
incidence that their exclusion is considered necessary to explain
the underlying performance of the Group and to improve the
comparability between periods. Therefore, the Group has presented
as an exceptional items:
· the derivative and foreign exchange losses pertaining to the
months of June 2023 and January to March 2024, amounting to $770m,
and
· the corresponding tax impact of $250m.
Since the devaluation in other
months did not meet the threshold criteria as per the Group's
policy on exceptional items, the Group has not presented the impact
pertaining to these months as exceptional.
Additionally, on account of the
translation from naira to US dollar (presentation currency of the
Group) of all the assets and liabilities (including Goodwill)
pertaining to the Group's Nigerian subsidiaries using the closing
exchange rate at 31 March 2024 and income and expenses at the
average exchange rates for the year ended 31 March 2024, the Group
incurred a foreign exchange translation loss recorded in other
comprehensive income amounting to $944m for the year ended 31 March
2024.
c) In
November 2023, the Reserve Bank of Malawi (RBM) announced
structural changes to the foreign exchange market with its decision
to adjust the exchange rate from selling rate of MWK 1,180 to a
selling rate of MWK 1,700 to the US dollar with effect from 9
November 2023. As part of the structural changes, the RBM started
authorizing dealer banks to freely negotiate exchange rates to
trade with their clients and amongst themselves, notwithstanding
any limitations previously in place. This change announced by the
RBM is a structural and material change (i.e. more than threshold
percentage devaluation in a month) and in line with the Group's
policy on exceptional items and alternative performance measures as
described in 'Note on exceptional items' on page 55, the impact of
this change is of such size, nature and incidence that its
exclusion is considered necessary to explain the underlying
performance of the Group and improve the comparability between
periods. Consequently, the Group has presented the impact arising
in November 2023 amounting to $37m and the corresponding tax
benefit $8m as an exceptional item.
Additionally, on account of
translation from MWK to US dollar (presentation currency of the
Group) of all the assets and liabilities (including Goodwill)
pertaining to the Group's subsidiaries in Malawi using the closing
exchange rate at 31 March 2024 and income and expenses at the
average exchange rates for the year ended 31 March 2024, the Group
incurred a foreign exchange translation loss recorded in other
comprehensive income amounting to $169m for the year ended 31 March
2024.
d) During the
year ended 31 March 2024, the company completed the cancellation
and extinction of all of its deferred shares (3,081,744,577 shares)
of USD $0.50 nominal value each (the "Capital Reduction"), which
was approved by shareholders at the annual general meeting of the
company held on 4 July 2023, and was sanctioned by the High Court
of England and Wales (the "High Court") on 15 August 2023 and
became effective on 18 August 2023 on its certification by the
Companies House. The effect of the Capital Reduction is to create
additional distributable reserves of $1,541m which will be
available to the company going forward and may be used to
facilitate returns to shareholders in the future, whether in the
form of dividends, distributions, or purchases of the company's own
shares. Accordingly, and in line with the High Court approval, the
carrying value of the deferred shares ($1,541m) has been
transferred to retained earnings.
e) On 29 August
2023, Airtel Uganda Limited issued a prospectus in relation to the
offer for sale of 8,000,000,000 ordinary shares, representing 20%
of Airtel Uganda Limited on the Uganda Stock Exchange (USE) in-line
with the 20% minimum public listing obligation for all National
Telecom Operators under the current Uganda Communications (Fees
& Fines) (Amendment) Regulations 2020.
In November 2023, Airtel Uganda
Limited completed an initial public offering (IPO) and listed on
the Main Investment Market Segment of the Uganda Securities
Exchange (USE) with a total of 4.4 billion shares (10.89% of Airtel
Uganda Limited's total share capital) transferred to minority
shareholders. Airtel Uganda received a 3-year waiver from the
Uganda Securities Exchange from the requirement to transfer the
remaining 9.11% required to meet the 20% shareholding listing
requirement.
This being a transaction
with non-controlling shareholders, the impact of $49m (excess of
consideration over proportionate net assets net of related
transaction costs) has been taken into 'Transaction with NCI
reserve' in the consolidated statement of changes in
equity.
f) On 01
March 2024, the Company announced the commencement of its share
buy-back programme. As part of the programme it entered into an
agreement with Citigroup Global Markets Limited ("Citi") to conduct
the first tranche of the buy-back amounting to a maximum of $50m
and carry out on-market purchases of its ordinary shares with the
Company subsequently purchasing its ordinary shares from Citi. For
the year ended 31 March 2024, the Company bought-back and cancelled
7,389,855 shares, resulting in 3,750,761,649 ordinary shares
outstanding as at 31 March 2024. The purchase price of the shares
bought-back was $9m and the Company carries a liability of $41m as
part of 'other financial liabilities' relating to the remaining
buy-back agreement with Citi. The nominal value ($0.5 per share) of
the cancelled shares, amounting to $4m, has been transferred to the
capital redemption reserve.
5. Segmental
information
The Group's segment information is
provided on the basis of geographical clusters and products to the
Group's chief executive officer (chief operating decision maker -
'CODM') for the purposes of resource allocation and assessment of
performance.
The Group's operating segments are
as follows:
Nigeria Mobile Services -
Comprising of mobile service operations in Nigeria;
East Africa Mobile Services -
Comprising of mobile service operations in Uganda, Zambia, Kenya,
Tanzania, Malawi and Rwanda;
Francophone Africa Mobile Services - Comprising of mobile service operations in DRC, Gabon,
Chad, Niger, Congo B, Madagascar and Seychelles;
Mobile money services*-
Comprising of mobile money services across the Group.
* Mobile
money services segment consolidates the results of mobile money
operations from all operating entities within the Group. Airtel
Money Commerce B.V. (AMC BV) is the holding company for all mobile
money services for the Group, and as of 31 March 2024, it controls
all mobile money operations excluding operations in Nigeria. It is
management's intention to continue work to transfer the Nigerian
mobile money services operations into AMC BV, subject to local
regulatory approvals.
Each segment derives revenue from
the respective services housed within each segment, as described
above. Expenses, assets and liabilities primarily related to the
corporate headquarters and centralised functions of the Group are
presented as unallocated Items.
The amounts reported to CODM are
based on the accounting principles used in the preparation of the
financial statements. Each segment's performance is evaluated based
on segment revenue and segment result.
The segment result is Underlying
EBITDA (defined as operating profit/(loss) for the period before
depreciation, amortisation and exceptional items). This is the
measure reported to the CODM for the purpose of resource allocation
and assessment of segment performance. During the year ended 31
March 2024 and 31 March 2023, the definition of EBITDA is equal to
underlying EBITDA since there are no exceptional items pertaining
to EBITDA and therefore EBITDA is presented in the segment
information below.
Inter-segment pricing and terms
are reviewed and changed by management to reflect changes in market
conditions and changes to such terms are reflected in the period in
which the changes occur.
The 'Eliminations' column
comprises inter-segment revenues eliminated upon
consolidation.
Segment assets and segment
liabilities comprise those assets and liabilities directly managed
by each segment. Segment assets primarily include receivables,
property, plant and equipment, capital work in progress,
right-to-use assets, intangibles assets, inventories and cash and
cash equivalents. Segment liabilities primarily include operating
liabilities. Segment capital expenditure comprises investment in
property, plant and equipment, capital work in progress, intangible
assets (excluding licenses) and capital advances.
Investment elimination upon
consolidation and resulting goodwill impacts are reflected in the
'Eliminations' column.
Summary of the segmental
information and disaggregation of revenue for the year ended and as
of 31 March 2024 is as follows:
|
Nigeria mobile
services
|
East Africa mobile
services
|
Francophone Africa
mobile services
|
Mobile
money
|
Others
(unallocated)
|
|
Total
|
Eliminations
|
Revenue from external customers
|
|
|
|
|
|
|
|
Voice revenue
|
710
|
850
|
619
|
-
|
-
|
-
|
2,179
|
Data revenue
|
654
|
621
|
459
|
-
|
-
|
-
|
1,734
|
Mobile money revenue
(1)
|
-
|
-
|
-
|
649
|
-
|
-
|
649
|
Other revenue
(2)
|
136
|
138
|
129
|
-
|
14
|
-
|
417
|
|
|
|
|
|
|
|
|
Total revenue from external customers
|
1,500
|
1,609
|
1,207
|
649
|
14
|
-
|
4,979
|
Inter-segment revenue
|
3
|
13
|
6
|
188
|
8
|
(218)
|
-
|
Total revenue
|
1,503
|
1,622
|
1,213
|
837
|
22
|
(218)
|
4,979
|
EBITDA
|
811
|
788
|
512
|
436
|
(119)
|
-
|
2,428
|
|
|
|
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
Depreciation and
amortisation
|
264
|
287
|
209
|
18
|
10
|
-
|
788
|
Finance costs
|
|
|
|
|
|
|
|
- Derivative and
foreign exchange losses
|
|
|
|
|
|
|
|
Nigerian naira
|
|
|
|
|
|
|
1,070
|
Other currencies
|
|
|
|
|
|
|
189
|
- Other finance
costs
|
|
|
|
|
|
|
482
|
Finance income
|
|
|
|
|
|
|
(38)
|
Share of profit of associate and
joint venture accounted for using equity method
|
|
|
|
|
|
|
(0)
|
Loss before tax
|
|
|
|
|
|
|
(63)
|
Other segment items
|
|
|
|
|
|
|
|
Capital expenditure
|
252
|
284
|
157
|
27
|
17
|
-
|
737
|
|
|
|
|
|
|
|
|
As of 31 March 2024
|
|
|
|
|
|
|
|
Segment assets
|
1,675
|
2,336
|
1,647
|
1,151
|
20,774
|
(17,722)
|
9,861
|
Segment liabilities
|
1,890
|
2,569
|
2,346
|
929
|
9,338
|
(9,511)
|
7,561
|
Investment in associate and joint
venture accounted for using equity method (included in segment
assets above)
|
-
|
-
|
5
|
-
|
-
|
-
|
5
|
|
|
|
|
|
|
|
|
|
(1) Mobile money revenue is net of inter-segment elimination of
$188m mainly for commission on sale of airtime. It includes $126m
pertaining to East Africa mobile services and the balance $62m
pertaining to Francophone Africa mobile service.
(2) Other revenue includes messaging, value added services,
enterprise, site sharing and handset sale revenue.
Summary of the segmental
information and disaggregation of revenue for the year ended 31
March 2023 is as follows:
|
Nigeria mobile
services
|
East Africa mobile
services
|
Francophone Africa
mobile services
|
Mobile
money
|
Others
(unallocated)
|
|
Total
|
Eliminations
|
Revenue from external customers
|
|
|
|
|
|
|
|
Voice revenue
|
1,052
|
835
|
604
|
-
|
-
|
-
|
2,491
|
Data revenue
|
884
|
537
|
366
|
-
|
-
|
-
|
1,787
|
Mobile money revenue
(1)
|
-
|
-
|
-
|
540
|
-
|
-
|
540
|
Other revenue
(2)
|
189
|
124
|
114
|
-
|
10
|
-
|
437
|
|
|
|
|
|
|
|
|
Total revenue from external customers
|
2,125
|
1,496
|
1,084
|
540
|
10
|
-
|
5,255
|
Inter-segment revenue
|
3
|
12
|
6
|
152
|
4
|
(177)
|
-
|
Total revenue
|
2,128
|
1,508
|
1,090
|
692
|
14
|
(177)
|
5,255
|
EBITDA
|
1,101
|
755
|
480
|
344
|
(105)
|
-
|
2,575
|
|
|
|
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
Depreciation and
amortisation
|
344
|
260
|
190
|
17
|
7
|
-
|
818
|
Finance costs
|
|
|
|
|
|
|
|
- Derivative and
foreign exchange losses
|
|
|
|
|
|
|
|
Nigerian naira
|
|
|
|
|
|
|
224
|
Other currencies
|
|
|
|
|
|
|
114
|
- Other finance
costs
|
|
|
|
|
|
|
414
|
Finance income
|
|
|
|
|
|
|
(29)
|
Share of profit of associate and
joint venture accounted for using equity method
|
|
|
|
|
|
|
(0)
|
Profit before tax
|
|
|
|
|
|
|
1,034
|
|
|
|
|
|
|
|
|
Other segment items
|
|
|
|
|
|
|
|
Capital expenditure
|
293
|
256
|
151
|
33
|
15
|
-
|
748
|
|
|
|
|
|
|
|
|
As of 31 March 2023
|
|
|
|
|
|
|
|
Segment assets
|
2,634
|
2,255
|
1,599
|
945
|
25,485
|
(21,752)
|
11,166
|
Segment liabilities
|
2,193
|
2,393
|
2,359
|
742
|
12,839
|
(13,168)
|
7,358
|
Investment in associate and joint
venture accounted for using equity method (included in segment
assets above)
|
|
-
|
4
|
-
|
-
|
-
|
4
|
(1) Mobile money revenue is net of inter-segment elimination of
$152m mainly for commission on sale of airtime. It includes $103m
pertaining to East Africa mobile services and balance $49m
pertaining to Francophone Africa mobile services.
(2) Other revenue includes messaging, value added services,
enterprise, site sharing and handset sale revenue.
Geographical information
disclosure based on the physical location of non-current assets
(PPE, CWIP, ROU, Intangible assets including goodwill and
intangible assets under development):
|
As of
|
|
31 March
2024
|
31 March
2023
|
United Kingdom
|
0
|
0
|
Nigeria
|
1,320
|
2,379
|
Netherlands (including
Goodwill)
|
2,517
|
3,464
|
Others(1)
|
3,003
|
2,889
|
Total
|
6,840
|
8,732
|
(1) majorly includes
other African countries where the Group operates.
6. Exceptional
items
Underlying profit
before tax excludes the following exceptional items
|
For the year
ended
|
|
|
31 March
2024
|
31 March
2023
|
Profit before tax
|
(63)
|
1,034
|
|
|
|
Add: Exceptional items
|
|
|
Finance costs
|
|
|
- Derivative and foreign exchange losses
|
|
-
|
Nigerian naira (refer to note
4(b))
|
770
|
|
Malawian kwacha (refer to note
4(c))
|
37
|
|
|
807
|
-
|
Underlying profit before tax
|
744
|
1,034
|
|
|
|
|
Underlying profit after tax
excludes the following exceptional items:
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
(Loss)/Profit after tax
|
(89)
|
750
|
-Exceptional items (as
above)
|
807
|
-
|
- Tax on above exceptional
items
|
|
|
Nigerian naira (refer to note
4(b))
|
(250)
|
-
|
Malawian kwacha (refer to note
4(c))
|
(8)
|
-
|
- Deferred tax asset
recognition(1)
|
-
|
(161)
|
|
549
|
(161)
|
Underlying profit after tax
|
460
|
589
|
(1) During the year ended 31 March
2023, the Group had recognised deferred tax assets in Airtel Kenya.
Airtel Kenya had carried forward losses and temporary differences
on which deferred tax was not previously recognised. Considering
Airtel Kenya's profitability trends, that tax losses were utilised
and on the basis of forecast future taxable profits, the Group had
determined that it was probable that taxable profits would be
available against which the tax losses and temporary differences
could be utilised. Consequently, the deferred tax asset recognition
criteria were met, leading to the recognition of an additional
deferred tax asset of $117m during the year ended 31 March 2023.
Additionally, the Group had also recognised deferred tax assets on
initial temporary differences for an extended period in Airtel
Tanzania and Airtel DRC amounting to $19m and $25m, respectively
based on updated probability of future taxable profits in these
subsidiaries.
Profit attributable to
non-controlling interests amounting to $76m (31 March 2023: $87m)
includes a loss of $4m (31 March 2023: gain of $10m) during the
year ended 31 March 2024, relating to the above exceptional
items.
7. Income tax
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
Current tax
|
332
|
408
|
Deferred tax
|
(306)
|
(124)
|
Income tax expense
|
26
|
284
|
8. Earnings per share
('EPS')
The details used in the
computation of basic EPS:
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
|
|
|
(Loss)/profit for the year
attributable to owners of the company
|
(165)
|
663
|
Weighted average ordinary shares
outstanding for basic EPS(1)
|
3,750,641,207
|
3,751,665,898
|
|
|
|
Basic (Loss)/earnings per share
|
(4.4
cents)
|
17.7 cents
|
The details used in the
computation of diluted EPS:
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
|
|
|
(Loss)/profit for the year
attributable to owners of the company
|
(165)
|
663
|
Weighted average ordinary shares
outstanding for diluted EPS(1)(2)
|
3,750,641,207
|
3,756,867,853
|
|
|
|
Diluted (Loss)/earnings per share
|
(4.4
cents)
|
17.7 cents
|
(1) The difference
between the basic and diluted number of shares at the end of March
2023 being 5,201,955 shares relates to awards committed but not yet
issued under the Group's share-based payment
schemes.
(2)
The 6,017,906 shares granted under different
share-based plans are not included in the calculation of diluted
earnings per share for the year ended 31 March 2024 as these are
anti-dilutive on account of losses during the period. These options
could potentially dilute basic earning per share in
future.
|
|
|
|
|
10. Goodwill
The following table presents the
reconciliation of changes in the carrying value of goodwill for the
year ended 31 March 2024 and 31 March 2023
|
Goodwill
|
Balance as of 1 April
2022
|
3,827
|
Foreign currency translation impact
|
(311)
|
Balance as of 31 March
2023
|
3,516
|
|
|
Balance as of 1 April
2023
|
3,516
|
Foreign currency translation impact
|
(947)
|
Balance as of 31 March
2024
|
2,569
|
11. Impairment
review
The carrying amount of goodwill is
attributed to the following groups of CGUs, which are also the
Group's operating segments:
|
|
|
As of
|
|
|
|
31 March
2024
|
31 March
2023
|
Nigeria Mobile Services
|
|
|
318
|
900
|
East Africa Mobile
Services
|
|
|
834
|
927
|
Francophone Africa Mobile
Services
|
|
|
500
|
503
|
Mobile Money Services
|
|
|
917
|
1,186
|
|
|
|
2,569(1)
|
3,516
|
|
|
|
|
|
|
|
(1)The decrease in carrying amount of goodwill by $947m is due
to foreign currency translation differences. Refer to note 4(b) and
4(c).
The Group tests goodwill for
impairment annually on 31 December. The carrying value of goodwill
as of 31 December 2023 was $436m, $833m, $503m and $967m for
Nigeria mobile services, East Africa mobile services and
Francophone Africa mobile services and Mobile money services,
respectively. The recoverable amounts of the above group of CGUs
are based on value-in-use, which are determined based on ten-year
business plans that have been approved by the Board.
Whilst the Board performed a
long-term viability assessment over a three-year period, for the
purposes of assessing liquidity, the Group has adopted a ten-year
plan for the purpose of impairment testing due to the following
reasons:
•
The Group operates in emerging markets where the telecommunications
and mobile money markets are underpenetrated when compared to
developed markets. In these emerging markets, short-term plans (for
example, five years) are not indicative of the long-term future
prospects and performance of the Group.
•
The life of the Group's regulatory telecom licences and network
assets are at an average of ten years, the spectrum renewals happen
for a period of ten years or more and in general the replacement of
technology happens after a similar duration, and
•
The potential opportunities of the emerging African telecom sector,
which is mostly a two-three player market with lower smartphone
penetration.
Accordingly, the Board approved
that this planning horizon reflects the assumptions for medium- to
long-term market developments, appropriately covers market dynamics
of emerging markets and better reflects the expected performance in
the markets in which the Group operates.
While using the ten-year plan, the
Group also considers external market data to support the
assumptions used in such plans, which is generally available only
for the first five years. Considering the degree of availability of
external market data beyond year five, the Group has performed
sensitivity analysis to assess the impact on impairment of using a
five-year plan. The results of this sensitivity analysis
demonstrate that the initial five-year plan with appropriate
changes, including long-term growth rates applied at the end of
this period does not result in any impairment and does not decrease
the recoverable value by more than 10% in any of the group of CGUs
as compared to the recoverable value using the ten-year plan.
Further, the Group is confident that projections for years six to
ten are reliable and can demonstrate its ability, based on past
experience, to forecast cash flows accurately over a longer period.
Accordingly, the Board has approved and the Group continues to
follow a consistent policy of using an initial forecast period of
ten years for the purpose of impairment testing.
The nominal cash flows used in the
impairment tests reflect the Group's current assessment of the
impact of climate change and associated commitments the Group has
made. Based on the analysis conducted so far, the Group is
satisfied that the impact of climate change does not lead to an
impairment as of 31 December 2023 and is adequately covered as part
of the sensitivities disclosed below.
The nominal cash flows beyond the
planning period are extrapolated using appropriate long-term
terminal growth rates. The long-term terminal growth rates used do
not exceed the long-term average growth rates of the respective
industry and country in which the entity operates and are
consistent with internal/external sources of
information.
The inputs used in performing the
impairment assessment at 31 December 2023 were as
follows:
Assumptions
|
Nigeria Mobile
Services
|
East Africa Mobile
Services
|
Francophone Africa Mobile
Services
|
Mobile Money
Services
|
Pre-tax Discount Rate
|
33.55%
|
21.76%
|
22.18%
|
23.59%
|
Capital expenditure range (as a percentage of
revenue)
|
5% - 18%
|
12% - 28%
|
10% -15%
|
2%-5%
|
Long term growth rate
|
11.00%
|
7.74%
|
6.81%
|
7.79%
|
As of 31 December 2023, the
impairment testing did not result in any impairment in the carrying
amount of goodwill in any group of CGUs.
The key assumptions in performing
the impairment assessment were as follows:
Assumptions
|
Basis of assumptions
|
Discount rate
|
Nominal discount rate reflects the
market assessment of the risks specific to the group of CGUs and
are estimated based on the weighted average cost of capital for
respective CGUs.
|
Capital expenditure
|
The cash flow forecasts of
capital and spectrum licences expenditure are based on experience
after considering the expenditure required to meet coverage,
licence and capacity requirements relating to voice, data and
mobile money services.
|
Long-term growth rates
|
The growth rates into perpetuity
used are in line with the nominal long-term average growth rates of
the respective industry and country in which the entity operates
and are consistent with the internal / external sources of
information.
|
As of 31 December 2023, impairment
testing did not result in any impairment in the carrying amount of
goodwill in any group of CGUs. The results of the impairment tests
using these rates show that the recoverable amount exceeds the
carrying amount by $1,263m for Nigeria mobile services (76%),
$2,211m for East Africa mobile services (92%), $994m for
Francophone Africa mobile services (64%) and $3,410m for Mobile
money (328%), respectively. The Group, therefore, concluded that no
impairment was required to the goodwill held against each group of
CGUs. Subsequent to December 2023, the Group has also performed
indicator testing for impairment of goodwill and has concluded that
there are no indicators of impairment (including on account of
devaluation of Nigeria naira).
Sensitivity in discount rate
and capital expenditure
Management believes that no
reasonably possible change in any of the key assumptions would
cause the difference between the carrying value and recoverable
amount for any cash-generating unit to be materially different from
the recoverable value in the base case. The table below sets out
the breakeven pre-tax discount rate for each group of CGUs, which
will result in the recoverable amount being equal with the carrying
amount for each group of CGUs:
|
Nigeria Mobile Services
|
East Africa Mobile Services
|
Francophone Africa Mobile Services
|
Mobile Money Services
|
Pre-tax Discount Rate
|
47.47%
|
32.37%
|
31.73%
|
67.24%
|
The table below presents the
increase in isolation in absolute capital expenditure as a
percentage of revenue (across all years of the impairment review)
which will result in equating the recoverable amount with the
carrying amount for each group of CGUs:
Assumptions
|
Nigeria Mobile
Services
|
East Africa Mobile
Services
|
Francophone Africa Mobile
Services
|
Mobile Money
Services
|
Capital expenditure range (as a
percentage of revenue)
|
7.12%
|
8.33%
|
6.07%
|
22.34%
|
No reasonably possible change in
the terminal growth rate would cause the carrying amount to exceed
the recoverable amount.
12. Cash and bank balances
('C&CE')
Cash and cash equivalents
|
As
of
|
|
31 March
2024
|
31 March
2023
|
Balances with
banks
|
|
|
- On current
accounts
|
192
|
248
|
- Bank deposits with
original maturity of three months or less
|
311
|
272
|
Balance held in
wallets
|
111
|
64
|
Remittance in
transit
|
5
|
1
|
Cash on hand
|
1
|
1
|
|
620
|
586
|
Other bank balances
|
|
As
of
|
|
|
31 March
2024
|
31 March
2023
|
-Term deposits with banks with original maturity of
|
|
344
|
117
|
more than three months
but less than 12 months
|
|
|
|
-Margin money deposits (1)
|
|
9
|
14
|
-Unpaid dividend
|
|
0
|
0
|
|
|
353
|
131
|
|
|
|
|
(1) Margin
money deposits represent amount given as collateral for legal cases
and/or bank guarantees for disputed matters.
For the purpose of the statement
of cash flows, cash and cash equivalents are as follows:
|
|
As
of
|
|
|
31 March
2024
|
31 March
2023
|
Cash and cash
equivalents as per statement of financial position
|
|
620
|
586
|
Balance held under
mobile money trust
|
|
737
|
616
|
Bank
overdraft
|
|
(457)
|
(361)
|
|
|
900
|
841
|
13. Share
capital
|
|
As of
|
|
|
31 March
2024
|
31 March
2023
|
|
|
|
|
Issued, subscribed and fully paid-up shares
|
|
|
|
3,750,761,649 ordinary shares of
$0.50 each
(March 2023: 3,758,151,504) Refer
to note 4(f)
|
|
1,875
|
1,879
|
Nil deferred shares of $0.50
each
(March 2023: 3,081,744,577) Refer
to note 4(d)
|
-
|
1,541
|
|
|
|
1,875
|
3,420
|
|
|
|
|
|
|
Terms/rights attached to equity shares
The company has followings two
classes of ordinary shares:
· Ordinary shares having par value of $0.50 per share. Each
holder of equity shares is entitled to cast one vote per share and
carry a right to dividends.
· Deferred shares of $0.50 each. These shares have been
cancelled and extinguished during the year ended 31 March 2024. For
details, please refer to note 4(d).
14. Borrowings
Non-current
|
|
As
of
|
|
|
31 March
2024
|
31 March
2023
|
Secured
|
|
|
|
Term
loans(1)
|
|
124
|
35
|
|
|
124
|
35
|
Unsecured
|
|
|
|
Term
loans(1)
|
|
823
|
644
|
Non-
convertible bonds (1) (2)
|
|
-
|
554
|
|
|
823
|
1,198
|
|
|
|
|
|
|
947
|
1,233
|
Current
|
|
As
of
|
|
|
31 March
2024
|
31 March
2023
|
Secured
|
|
|
|
Term
loans(1)
|
|
15
|
9
|
|
|
15
|
9
|
Unsecured
|
|
|
|
Non- convertible
bonds(1)(2)
|
|
550
|
-
|
Term
loans(1)
|
|
404
|
575
|
Bank
overdraft
|
|
457
|
361
|
|
|
1,411
|
936
|
|
|
1,426
|
945
|
(1) Includes debt origination costs.
(2) It includes impact of fair value hedges.
15. Contingent liabilities and
commitments
(i) Contingent liabilities
|
|
As of
|
|
|
31 March
2024
|
31 March
2023
|
|
|
|
|
(a) Taxes, duties and other demands (under adjudication /
appeal / dispute)
|
|
|
|
-Income tax
|
|
13
|
16
|
-Value added tax
|
|
20
|
20
|
-Customs duty & Excise
duty
|
|
9
|
9
|
-Other miscellaneous
demands
|
|
7
|
5
|
(b) Claims under legal and
regulatory cases including
arbitration matters
|
|
76
|
82
|
|
|
125
|
132
|
There are uncertainties in the
legal, regulatory and tax environments in the countries in which
the Group operates and there is a risk of demands, which may be
raised based on current or past business operations. Such demands
have in the past been challenged and contested on merits with the
relevant authorities and appropriate settlements agreed.
The reduction of $7m in contingent
liabilities during the year ended 31 March 2024 is primarily due to
currency devaluation in subsidiaries.
The company and its subsidiaries
are currently and may become, from time to time, involved in a
number of legal proceedings, including inquiries from, or
discussions with, governmental authorities that are incidental to
their operations. As of 31 March 2024, the Group's key contingent
liabilities include the following:
Claims under legal and regulatory cases including arbitration
matter
One of the subsidiaries of the
Group is involved in a dispute with one of its vendors, with
respect to invoices for services provided to a subsidiary under a
service contract. The original order under the contract was issued
by the subsidiary for a total amount of Central African franc (CFA)
473,800,000 (approximately $1m). In 2014, the vendor-initiated
arbitration proceedings claiming a sum of approximately CFA 1.9
billion (approximately $3m) based on the court award. Multiple
court proceeding have happened from 2015 onwards and in mid-May
2019, the lower courts imposed a penalty of CFA 35 billion
(approximately $58m), based on which certain banks of the
subsidiary were summoned to release the funds. The subsidiary
immediately lodged an appeal in the Supreme Court for a stay of
execution which was granted. Subsequently, the vendor filed an
appeal before the Common Court of Justice and Arbitration (CCJA).
Quite unexpectedly, in April 2020, the CCJA lifted the Supreme
Court stay of execution. In May 2021, the Commercial Division of
the High Court maintained new seizures carried out by the vendor.
The subsidiary appealed and the Court of Appeal determination on
the seizures is pending as of April 2022. In March 2022 the CCJA
interpreted its judgment of March 2019 to indicate that the daily
penalty could not be maintained after its ruling dated 18 November
2018.
Separately, in December 2020 the
subsidiary initiated criminal proceedings against the vendor for
fraud and deceitful conduct. In February 2021, the investigating
judge issued an order to cease the investigation which was appealed
by the Subsidiary. In March 2022, the Court Appeal quashed the
investigative judge order and allowed the investigation into the
vendor to resume. Testimony in the criminal investigation case
happened on 26 April 2022 in front of the criminal court of appeal
where the honorable judge has further re-examined the facts from
the representatives of the subsidiary against this case. A stay of
execution was issued on 30 May 2022 by the Chamber of Accusation in
favour of subsidiary till the time criminal investigation is
completed. In October 2023, the criminal court ordered the
dismissal of the case despite evidence of initial payment provided
to the judge. The subsidiary has appealed to the Supreme Court, and
a decision is awaited.
As per the law no civil action can
be initiated against the subsidiary while criminal proceedings are
ongoing.
On 30 November 2022 subsidiary was
notified that plaintiff has appealed in the court of cassation
against the stay of execution dated 30 May 2022. Subsidiary has
filed its response on 26 January 2023. On 8 May 2023, the
subsidiary filed an application in the Commercial court to seek a
cease-and-desist order against the vendor. The matter is pending
before the Commercial court, and the substantial appeal has been
transferred to CCJA in February 2024.
The Group still awaits the ruling
on the merits of the case, and the outcome of the criminal
investigations, and until that time has disclosed this matter as
Contingent Liability for $58m (included in the closing contingent
liability). No provision has been made against this
claim.
In addition to the individual
matters disclosed above, in the ordinary course of business, the
Group is a defendant or co-defendant in various litigations and
claims which are immaterial individually.
Guarantees:
Guarantees outstanding as of 31
March 2024 and 31 March 2023 amounting to $12m and $9m respectively
have been issued by banks and financial institutions on behalf of
the Group. These guarantees include certain financial bank
guarantees which have been given for sub-judice matters and the
amounts with respect to these have been disclosed under capital
commitments, contingencies and liabilities, as applicable, in
compliance with the applicable accounting standards.
Commitments
Capital Commitments
The Group has contractual
commitments towards capital expenditure (net of related advances
paid) of $317m and $313m as of 31 March 2024 and 31 March 2023
respectively.
16. Related Party disclosure
a) List of related
parties
i) Parent
company
Airtel
Africa Mauritius Limited
ii) Intermediate parent
entities
Network i2i
Limited
Bharti
Airtel Limited
Bharti
Telecom Limited
iii) Ultimate controlling
entity
Bharti Enterprises (Holding)
Private Limited. It is held by private trusts of Bharti family,
with Mr. Sunil Bharti Mittal's family trust effectively controlling
the company.
iv) Associate:
Seychelles Cable Systems Company
Limited
v) Joint Venture
Mawezi RDC S.A.
vi) Other entities with whom
transactions have taken place during the reporting
period
a. Fellow
subsidiaries
Nxtra Data Limited
Bharti Airtel Services
Limited
Bharti International (Singapore)
Pte Ltd
Bharti Airtel (UK)
Limited
Bharti Airtel (France)
SAS
Bharti Airtel Lanka (Private)
Limited
Bharti Hexacom Limited
b. Other related parties
Singapore Telecommunication
Limited
vii) Key Management Personnel
('KMP')
a. Executive
directors
Olusegun Ogunsanya
Jaideep Paul
b. Non-Executive
directors
Sunil Bharti Mittal
Awuneba Ajumogobia
Douglas Baillie (till October
2023)
John Danilovich
Andrew Green
Akhil Gupta
Shravin Bharti Mittal
Annika Poutiainen
Ravi Rajagopal
Kelly Bayer Rosmarin (till October
2023)
Tsega Gebreyes
c. Others
Ian Basil Ferrao
Michael Foley (till June 2023)
Razvan Ungureanu
Luc Serviant (till May 2023)
Daddy Mukadi Bujitu
Neelesh Singh (till December 2022)
Ramakrishna Lella
Edgard Maidou (till June 2023)
Rogany Ramiah
Stephen Nthenge
Vimal Kumar Ambat (till
October 2022)
Ashish Malhotra (till June
2022)
Vinny Puri (till June
2022)
C Surendran (till December
2022)
Olubayo Augustus Adekanmbi
(till November 2022)
Anthony Shiner (since June
2022)
Apoorva Mehrotra (since October
2022)
Oliver Fortuin (since June
2023)
Martin Frechette (since June
2023)
Carl Cruz (since May
2023)
Anwar Soussa (since August
2023)
Jacques Barkhuizen (since October
2023)
Sunil Taldar (since October
2023)
The outstanding balance of the
above-mentioned related parties are as follows:
Relationship
|
Parent
company
|
Intermediate parent
entity
|
Fellow
subsidiaries
|
Joint
venture
|
Associate
|
As of 31 March 2024
|
|
|
|
|
|
Trade payables
|
-
|
8
|
40
|
-
|
0
|
Trade receivables
|
-
|
4
|
70
|
-
|
-
|
Corporate guarantee fee
payable
|
-
|
1
|
-
|
-
|
-
|
Guarantees and collaterals taken
(including performance guarantees)(1)
|
-
|
2,000
|
-
|
-
|
-
|
|
|
|
|
|
|
As of 31 March 2023
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables
|
-
|
12
|
31
|
-
|
1
|
Trade receivables
|
-
|
4
|
46
|
-
|
-
|
Corporate guarantee fee
payable
|
-
|
1
|
-
|
-
|
-
|
Guarantees and collaterals taken
(including performance guarantees)
|
-
|
2,000
|
-
|
-
|
-
|
Reimbursement asset
|
-
|
10
|
-
|
-
|
-
|
(1) This guarantee (200% of the
bond amount) relates to the $1bn USD non-convertible bonds (refer
to note 14) with original maturity of 2024. The Group had prepaid a
portion of these bonds and the outstanding amount as on 31 March
2024 is $550m (31 March 2023: $550m). In accordance with the legal
and regulatory requirements pertaining to these bonds, the
guarantee amount can be reduced only once these are paid in full
and thus the full guarantee amount (based on issued value of
guarantee) is disclosed.
(c) Key management compensation ('KMP')
KMP are those persons having
authority and responsibility for planning, directing and
controlling the activities of the Group, directly or indirectly,
including any director, whether executive or otherwise. For the
Group, these include executive committee members. Remuneration to
KMP were as follows:
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
Short-term employee
benefits
|
11
|
10
|
Performance linked
incentive
|
4
|
4
|
Share-based payment
|
3
|
2
|
Other long term
benefits
|
2
|
2
|
Other benefits
|
1
|
0
|
|
21
|
18
|
17. Fair Value of financial assets and
liabilities
The details as to the carrying
value, fair value and the level of fair value measurement hierarchy
of the group's financial instruments are as follows:
|
|
Carrying value as
of
|
Fair value as
of
|
|
31 March
2024
|
31 March
2023
|
31 March
2024
|
31 March
2023
|
Financial assets
|
|
|
|
|
|
FVTPL
|
|
|
|
|
|
Derivatives
|
|
|
|
|
|
- Forward and option
contracts
|
Level 2
|
10
|
4
|
10
|
4
|
- Currency swaps and
interest rate swaps
|
Level 2
|
0
|
9
|
0
|
9
|
Other bank balances
|
Level 2
|
0
|
4
|
0
|
4
|
Investments
|
Level 2
|
0
|
0
|
0
|
0
|
|
|
|
|
|
|
Amortised cost
|
|
|
|
|
|
Trade receivables
|
|
184
|
145
|
184
|
145
|
Cash and cash
equivalents
|
|
620
|
586
|
620
|
586
|
Other bank balances
|
|
353
|
127
|
353
|
127
|
Balance held under mobile money
trust
|
|
737
|
616
|
737
|
616
|
Other financial assets
|
|
136
|
176
|
136
|
176
|
|
|
|
|
|
|
|
|
2,040
|
1,667
|
2,040
|
1,667
|
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
|
FVTPL
|
|
|
|
|
|
Derivatives
|
|
|
|
|
|
- Forward and option
contracts
|
Level 2
|
22
|
5
|
22
|
5
|
- Currency swaps and
interest rate swaps
|
Level 2
|
0
|
0
|
0
|
0
|
- Cross currency swaps
|
Level 3
|
155
|
43
|
155
|
43
|
- Embedded derivatives
|
Level 2
|
0
|
0
|
0
|
0
|
|
|
|
|
|
|
Amortised cost
|
|
|
|
|
|
Long term borrowings - fixed
rate
|
Level 1
|
-
|
554
|
-
|
540
|
Long term borrowings - fixed
rate
|
Level 2
|
271
|
227
|
257
|
210
|
Long term borrowings - floating
rate
|
|
676
|
452
|
676
|
452
|
Short term borrowings - fixed
rate
|
Level 1
|
550
|
-
|
549
|
-
|
Short term borrowings
|
|
876
|
945
|
876
|
945
|
Put option
liability
|
Level 3
|
552
|
569
|
552
|
569
|
Trade payables
|
|
422
|
460
|
422
|
460
|
Mobile money wallet
balance
|
|
722
|
582
|
722
|
582
|
Other financial
liabilities
|
|
586
|
680
|
586
|
680
|
|
|
4,832
|
4,517
|
4,817
|
4,486
|
The following methods/assumptions
were used to estimate the fair values:
· The
carrying value of bank deposits, trade receivables, trade payables,
balance held under mobile money trust, mobile money wallet balance,
short-term borrowings, other current financial assets and
liabilities approximate their fair value mainly due to the
short-term maturities of these instruments.
· Fair
value of quoted financial instruments is based on quoted market
price at the reporting date.
· The
fair value of non-current financial assets, long-term borrowings
and other financial liabilities is estimated by discounting future
cash flows using current rates applicable to instruments with
similar terms, currency, credit risk and remaining
maturities.
· The
fair values of derivatives are estimated by using pricing models,
wherein the inputs to those models are based on readily observable
market parameters. The valuation models used by the Group reflect
the contractual terms of the derivatives (including the period to
maturity), and market-based parameters such as interest rates,
foreign exchange rates, volatility etc. These models do not contain
a high level of subjectivity as the valuation techniques used do
not require significant judgement and inputs thereto are readily
observable.
· The
fair value of the put option liability (included in other financial
liability) to buy back the stake held by non-controlling interest
in AMC BV is measured at the present value of the redemption amount
(i.e. expected cash outflows). Since, the liability will be based
on fair value of the equity shares of AMC BV (subject to a cap) at
the end of 48 months , the expected cash flows are estimated by
determining the projected equity valuation of the AMC BV at the end
of 48 months expiring in August 2025 and applying cap
thereon.
During the year ended 31
March 2024 and 31 March 2023 there were no transfers between Level
1 and Level 2 fair value measurements, and no transfer into and out
of Level 3 fair value measurements.
The following table describes the
key inputs used in the valuation (basis discounted cash flow
technique) of the Level 2 and Level 3 financial assets/liabilities
as of 31 March 2024 and 31 March 2023:
|
Financial assets / liabilities
|
|
|
|
Inputs used
|
|
|
|
|
-
|
Currency swaps, forward and option
contracts and other bank balances
|
|
Forward foreign currency exchange
rates, Interest rate
|
|
-
|
Interest rate swaps
|
|
|
|
|
Prevailing / forward interest
rates in market, Interest rate
|
|
-
|
Embedded derivatives
|
|
|
|
Prevailing interest rates in
market, inflation rates
|
|
-
|
Other financial assets / fixed
rate borrowing / other financial
liabilities
|
Prevailing interest rates in
market, Future payouts, Interest rates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key inputs for level 3
The fair value of cross currency
swap (CCS) has been estimated based on the contractual terms of the
CCS and parameters such as interest rates, foreign exchange rates
etc. Since the data from any observable markets in respect of
interest rates is not available, the interest rates are considered
to be significant unobservable inputs to the valuation of this
CCS.
Reconciliation of fair value measurements categorised within
level 3 of the fair value hierarchy - Financial
Assets/(Liabilities) (net)
• Cross Currency Swaps
('CCS')
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
Opening Balance
|
(43)
|
(6)
|
Recognised in finance costs in
profit and loss(unrealised)
|
(284)
|
(65)
|
Repayment of Interest
|
9
|
4
|
Cross Currency Swap
repayment
|
23
|
22
|
Foreign currency translation
impact recognised in OCI
|
140
|
2
|
Closing Balance
|
(155)
|
(43)
|
• Put option liability
|
For the year
ended
|
|
31 March
2024
|
31 March
2023
|
Opening Balance
|
(569)
|
(579)
|
Liability de-recognised by
crediting transaction with NCI reserve(1)
|
24
|
16
|
Recognised in finance costs in
profit and loss (unrealised)
|
(7)
|
(6)
|
Closing Balance
|
(552)
|
(569)
|
(1) Put option
liability was reduced by $24m (March 2023: $16m) for dividend
distribution to put option NCI holders. Any dividend paid to the
put option NCI holders is adjustable against the put option
liability based on put option arrangement.
18. Events after the balance sheet date
No material subsequent events or
transactions have occurred since the date of statement of financial
position except as disclosed below:
· The
Board recommended a final dividend of 3.57 cents per share on 8 May
2024.
Appendix
Additional information pertaining to three months ended March
31, 2024
Condensed Consolidated Statement of Comprehensive
Income
(All amounts are in US$ millions
unless stated otherwise)
|
|
For three months
ended
|
|
|
31 March
2024
|
31 March
2023
|
Income
|
|
|
|
Revenue
|
|
1,118
|
1,341
|
Other income
|
|
3
|
4
|
|
|
1,121
|
1,345
|
Expenses
|
|
|
|
Network operating
expenses
|
|
210
|
268
|
Access charges
|
|
63
|
102
|
License fee and spectrum
usage charges
|
|
61
|
62
|
Employee benefits
expense
|
|
72
|
76
|
Sales and marketing
expenses
|
|
140
|
134
|
Impairment loss on financial
assets
|
|
-
|
(4)
|
Other expenses
|
|
55
|
48
|
Depreciation and
amortisation
|
|
173
|
220
|
|
|
774
|
906
|
|
|
|
|
Operating profit
|
|
347
|
439
|
|
|
|
|
Finance costs
-
Derivative and foreign exchange losses
|
|
|
|
Nigerian naira
|
|
323
|
54
|
Other currencies
|
|
33
|
35
|
- Other
finance costs
|
|
120
|
121
|
Finance income
|
|
(11)
|
(6)
|
Share of profit for associate and joint venture accounted for
using equity method
|
|
(0)
|
2
|
(Loss)/profit before
tax
|
|
(118)
|
233
|
|
|
|
|
Tax expense
|
|
(27)
|
6
|
(Loss)/profit for the
period
|
|
(91)
|
227
|
|
|
|
|
(Loss)/profit before tax (as
presented above)
|
|
(118)
|
233
|
Add/(less): Exceptional
items (net)
|
|
323
|
-
|
Underlying profit before tax
|
|
205
|
233
|
|
|
|
|
(Loss)/profit after tax (as
presented above)
|
|
(91)
|
227
|
Add/(less): Exceptional
items (net)
|
|
219
|
(99)
|
Underlying profit after tax
|
|
128
|
128
|
|
|
|
|
Other comprehensive income ('OCI')
|
|
|
|
Items to be reclassified subsequently to profit or
loss:
|
|
|
|
Net loss due to foreign
currency translation differences
|
|
(179)
|
(41)
|
Gain on debt instruments at fair
value through other comprehensive income
|
|
-
|
-
|
Tax on above
|
|
2
|
(1)
|
Share of OCI of
associate and joint venture accounted for using equity
method
|
|
0
|
0
|
|
|
(177)
|
(42)
|
Items not to be reclassified subsequently to profit or
loss:
|
|
|
|
Re-measurement (loss)/gain on defined benefit plans
|
|
(0)
|
1
|
Tax
on above
|
|
0
|
(0)
|
|
|
(0)
|
1
|
|
|
|
|
Other comprehensive loss for the
period
|
|
(177)
|
(41)
|
Total comprehensive (loss)/income for the
period
|
|
(268)
|
186
|
|
|
|
|
|
|
For three months
ended
|
|
|
31 March 2024
|
31 March 2023
|
|
|
|
|
(Loss)/profit for the period attributable
to:
|
|
(91)
|
227
|
|
|
|
|
Owners of the
company
|
|
(104)
|
195
|
Non-controlling
interests
|
|
13
|
32
|
|
|
|
|
Other comprehensive loss for the period attributable
to:
|
|
(177)
|
(41)
|
|
|
|
|
Owners of the
company
|
|
(175)
|
(41)
|
Non-controlling
interests
|
|
(2)
|
0
|
|
|
|
|
Total comprehensive (loss)/income for the period
attributable to:
|
|
(268)
|
187
|
|
|
|
|
Owners of the
company
|
|
(279)
|
154
|
Non-controlling
interests
|
|
11
|
33
|
Alternative performance measures (APMs)
Introduction
In the reporting of financial
information, the directors have adopted various APMs. These
measures are not defined by International Financial Reporting
Standards (IFRS) and therefore may not be directly comparable with
other companies APMs, including those in the Group's
industry.
APMs should be considered in
addition to, and are not intended to be a substitute for, or
superior to, IFRS measurements.
Purpose
The directors believe that these
APMs assist in providing additional useful information on the
underlying trends, performance and position of the
Group.
APMs are also used to enhance the
comparability of information between reporting periods and
geographical units (such as like-for-like sales), by adjusting for
non-recurring or uncontrollable factors which affect IFRS measures,
to aid users in understanding the Group's performance.
Consequently, APMs are used by the directors and management for
performance analysis, planning, reporting and incentive-setting
purposes.
The directors believe the
following metrics to be the APMs used by the Group to help evaluate
growth trends, establish budgets and assess operational performance
and efficiencies. These measures provide an enhanced understanding
of the Group's results and related trends, therefore increasing
transparency and clarity into the core results of the
business.
The following metrics are useful
in evaluating the Group's operating performance:
APM
|
Closest equivalent IFRS measure
|
Adjustments to reconcile to IFRS measure
|
Definition and
purpose
|
EBITDA and margin
|
Operating profit
|
· Depreciation and amortisation
|
The Group defines EBITDA as operating profit/(loss) for
the period
before depreciation and amortisation.
The Group defines EBITDA margin as
EBITDA divided by revenue.
EBITDA and margin are measures used
by the directors to assess the trading performance of the
business and are therefore the measure of segment profit that the Group presents under IFRS. EBITDA and margin are also
presented on a consolidated basis because the directors believe it
is important to consider profitability on a basis consistent with that of the Group's operating segments.
When presented on a
consolidated basis, EBITDA and margin are APMs.
Depreciation and amortisation is a
non-cash item which fluctuates depending on the timing of capital
investment and useful economic life. Directors believe that a
measure which removes this volatility improves comparability of the
Group's results period on period and hence is adjusted to arrive at
EBITDA and margin.
|
Underlying profit / (loss) before
tax
|
Profit / (loss) before
tax
|
· Exceptional items (Refer note on exceptional items on page
55)
|
The Group defines underlying
profit/(loss) before tax as profit/(loss) before tax adjusted for
exceptional items.
The directors view underlying
profit/(loss) before tax to be a meaningful measure to analyse the
Group's profitability.
|
Effective tax rate
|
Reported tax rate
|
· Exceptional items (Refer note on
exceptional items on page 55)
· Foreign exchange rate movements
· One-off tax impact of prior period, tax litigation settlement
and impact of tax on permanent differences
|
The Group defines effective tax
rate as reported tax rate (reported tax charge divided by reported
profit before tax) adjusted for exceptional items, foreign exchange
rate movements and one-off tax items of prior period adjustment,
tax settlements and impact of permanent differences on
tax.
This provides an indication of the
current on-going tax rate across the Group.
Foreign exchange rate movements
are specific items that are non-tax deductible in a few of the
entities which are loss making and/or where DTA is not yet
triggered and hence are considered to hinder comparison of the
Group's effective tax rate on a period-to-period basis and
therefore excluded to arrive at effective tax rate.
One-off tax impact on account of
prior period adjustment, any tax litigation settlement and tax
impact on permanent differences are additional specific items that
because of their size and frequency in the results, are considered
to hinder comparison of the Group's effective tax rate on a
period-to-period basis.
|
Underlying profit/(loss) after
tax
|
Profit/(loss) for the
period
|
· Exceptional items (Refer note on exceptional items on page
55)
|
The Group defines underlying
profit/(loss) after tax as profit/(loss) for the period adjusted
for exceptional items.
The directors view underlying
profit/(loss) after tax to be a meaningful measure to analyse the
Group's profitability.
|
Earnings per share before
exceptional items
|
EPS
|
· Exceptional items (Refer note on exceptional items on page
55)
|
The Group defines earnings per
share before exceptional items as profit/(loss) for the period
before exceptional items attributable to owners of the company
divided by the weighted average number of ordinary shares in issue
during the financial period.
This measure reflects the earnings
per share before exceptional items for each share unit of the
company.
|
Earnings per share before
exceptional items and derivative and foreign exchange
losses*
|
EPS
|
· Exceptional items (Refer note on exceptional items on page
55)
· Derivative and foreign exchange losses
|
The Group defines earnings per
share before exceptional items and derivative and foreign exchange
losses as profit/(loss) for the period before exceptional items and
derivative and foreign exchange losses (net of tax) attributable to
owners of the company divided by the weighted average number of
ordinary shares in issue during the financial period.
This measure reflects the earnings
per share before exceptional items and derivative and foreign
exchange losses for each share unit of the company.
Derivative and foreign exchange
losses are due to revaluation of US dollar balance sheet
liabilities and derivatives as a result of currency
devaluation.
|
Operating free cash flow
|
Cash generated from operating
activities
|
· Income tax paid
· Changes in working capital
· Other non-cash items
· Non-operating income
· Exceptional items (Refer note on exceptional items on page
55)
· Capital expenditures
|
The Group defines operating free
cash flow as net cash generated from operating activities before
income tax paid, changes in working capital, other non-cash items,
non-operating income, exceptional items, and after capital
expenditures. The Group views operating
free cash flow as a key liquidity measure, as it indicates the cash
available to pay dividends, repay debt or make further investments
in the Group.
|
Net debt and leverage
ratio
|
Borrowings
|
· Lease liabilities
· Cash and cash equivalent
· Term deposits with banks
· Deposits given against borrowings/ non-derivative financial
instruments
· Fair value hedges
|
The Group defines net debt as
borrowings including lease liabilities less cash and cash
equivalents, term deposits with banks, deposits given against
borrowings/non-derivative financial instruments, processing costs
related to borrowings and fair value hedge adjustments.
The Group defines leverage ratio
as net debt divided by EBITDA for the preceding 12
months.
The directors view net debt and
the leverage ratio to be meaningful measures to monitor the Group's
ability to cover its debt through its earnings.
|
Return on capital
employed
|
No direct equivalent
|
· Exceptional items (Refer note on exceptional items on page
55) to arrive at EBIT
|
The Group defines return on
capital employed ('ROCE') as EBIT divided by average capital
employed.
The directors view ROCE as a
financial ratio that measures the Group's profitability and the
efficiency with which its capital is being utilised.
The Group defines EBIT as
operating profit/(loss) for the period.
Capital employed is defined as sum
of equity attributable to owners of the company (grossed up for put
option provided to minority shareholders to provide them liquidity
as part of the sale agreements executed with them during year ended
31 March 2022), non-controlling interests and net debt. Average
capital employed is average of capital employed at the closing and
beginning of the relevant period.
For quarterly computations, ROCE
is calculated by dividing EBIT for the preceding 12 months by the
average capital employed (being the average of the capital employed
averages for the preceding four quarters).
|
* New APM added during the year ended 31 March
2024
Some of the Group's IFRS measures
and APMs are translated at constant currency exchange rates to
measure the organic performance of the Group. In determining the
percentage change in constant currency terms, both current and
previous financial reporting period's results have been converted
using exchange rates prevailing as on 31 March 2023 for all
countries, except Nigeria. For Nigeria the constant currency
exchange rate used is 752.2 NGN/USD which is prevailing rate as on
30 June 2023.Reported currency percentage change is derived based
on the average actual periodic exchange rates for that financial
period. Variances between constant currency and reported currency
percentages are due to exchange rate movements between the previous
financial reporting period and the current period. The constant
currency numbers only reflect the retranslation of reported numbers
into exchange rates as of 31 March 2023 (Nigeria as of 30 June
2023) and are not intended to represent the wider impact that
currency changes has on the business.
Reconciliation between GAAP and Alternative Performance
Measures
Table A: EBITDA and margin
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
Operating profit
|
$m
|
1,640
|
1,757
|
Add:
|
|
|
|
Depreciation and
amortisation
|
$m
|
788
|
818
|
EBITDA
|
$m
|
2,428
|
2,575
|
Revenue
|
$m
|
4,979
|
5,255
|
EBITDA margin (%)
|
%
|
48.8%
|
49.0%
|
Table B: Underlying profit / (loss) before
tax
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
(Loss) / Profit before tax
|
$m
|
(63)
|
1,034
|
Finance cost - exceptional
items
|
$m
|
807
|
-
|
Underlying profit before tax
|
$m
|
744
|
1,034
|
Table C: Effective tax rate
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
Profit before
taxation
|
Income tax
expense
|
Tax rate %
|
Profit before
taxation
|
Income tax
expense
|
Tax rate %
|
Reported effective tax rate (after EI)
|
$m
|
(63)
|
26
|
(41.1%)
|
1,034
|
284
|
27.4%
|
Exceptional items (provided
below)
|
$m
|
807
|
258
|
|
-
|
161
|
|
Reported effective tax rate (before EI)
|
$m
|
744
|
284
|
38.3%
|
1,034
|
445
|
43.0%
|
Adjusted for:
|
|
|
|
|
|
|
|
Foreign exchange rate movement for
loss making entity and/or non-DTA operating companies & holding
companies
|
$m
|
57
|
-
|
|
106
|
-
|
|
One-off adjustment and tax on
permanent differences
|
$m
|
-
|
24
|
|
5
|
(1)
|
|
Effective tax rate
|
$m
|
801
|
308
|
38.4%
|
1,145
|
444
|
38.8%
|
Exceptional
items
|
|
|
|
|
|
|
|
1. Deferred tax asset
recognition
|
$m
|
-
|
- |
|
-
|
161
|
|
2. Derivative and foreign exchange
rate losses
|
$m
|
807
|
258
|
|
-
|
-
|
|
Total
|
$m
|
807
|
258
|
|
-
|
161
|
|
a) $258m
exceptional tax gain in full year period ended 31 March 2024 is tax
gain corresponding to $807m derivative and foreign exchange losses
following Nigerian naira and Malawian kwacha
devaluation.
b) $161m
exceptional tax gain in full year ended 31 March 2023 is on account
of deferred tax credit in Kenya, Democratic Republic of Congo and
Tanzania.
Table D: Underlying profit / (loss) after
tax
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
(Loss) / profit after tax
|
$m
|
(89)
|
750
|
Finance cost - exceptional
items
|
$m
|
807
|
-
|
Tax exceptional items
|
$m
|
(258)
|
(161)
|
Underlying profit after tax
|
$m
|
460
|
589
|
Table E: Earnings per share before exceptional
items
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
(Loss)/Profit for the period attributable to owners of the
company
|
$m
|
(165)
|
663
|
Finance cost - exceptional
items
|
$m
|
807
|
-
|
Tax exceptional items
|
$m
|
(258)
|
(161)
|
Non-controlling interest
exceptional items
|
$m
|
(4)
|
10
|
Profit for the period attributable to owners of the
company-
before exceptional items
|
$m
|
380
|
512
|
Weighted average number of ordinary
shares in issue during the financial
period.
|
Million
|
3,751
|
3,752
|
Earnings per share before exceptional items
|
Cents
|
10.1
|
13.6
|
Table F: Earnings per share before exceptional items and
derivative and foreign exchange losses
Description
|
UoM
|
Year ended
|
March 2024
|
31-Mar-23
|
(Loss)/Profit for the period attributable to owners of the
company
|
$m
|
(165)
|
663
|
Finance cost - exceptional
items
|
$m
|
807
|
-
|
Tax exceptional items
|
$m
|
(258)
|
(161)
|
Non-controlling interest
exceptional items
|
$m
|
(4)
|
10
|
Profit for the period attributable to owners of the company-
before exceptional items
|
$m
|
380
|
512
|
Derivative and foreign exchange
losses (excluding exceptional items)
|
$m
|
452
|
338
|
Tax on derivative and foreign
exchange losses (excluding exceptional items)
|
$m
|
(130)
|
(77)
|
Non-controlling interest on
derivative and foreign exchange losses (excluding exceptional
items) - net of tax
|
$m
|
(17)
|
(4)
|
Profit for the period attributable to owners of the company-
before exceptional items and derivative and foreign exchange
losses
|
$m
|
685
|
769
|
Weighted average number of ordinary
shares in issue during the financial period
|
Million
|
3,751
|
3,752
|
Earnings per share before exceptional items and derivative and
foreign exchange losses
|
Cents
|
18.3
|
20.5
|
Table G: Operating free cash flow
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
Net cash generated from operating activities
|
$m
|
2,259
|
2,229
|
Add: Income tax
paid
|
$m
|
344
|
397
|
Net cash generation from operation before
tax
|
$m
|
2,603
|
2,626
|
Less: Changes in working capital
|
|
|
|
Increase in trade
receivables
|
$m
|
79
|
45
|
Increase in
inventories
|
$m
|
16
|
13
|
Increase in trade
payables
|
$m
|
(56)
|
(9)
|
Increase in mobile
money wallet balance
|
$m
|
(207)
|
(120)
|
(Increase)/Decrease
in provisions
|
$m
|
(3)
|
32
|
Increase in deferred
revenue
|
$m
|
(21)
|
(37)
|
Increase in other
financial and non-financial liabilities
|
$m
|
(76)
|
(113)
|
Increase in other
financial and non-financial assets
|
$m
|
93
|
140
|
Operating cash flow before changes in working
capital
|
$m
|
2,428
|
2,577
|
Other non-cash
adjustments
|
$m
|
-
|
(2)
|
EBITDA
|
$m
|
2,428
|
2,575
|
Less: Capital
expenditure
|
$m
|
(737)
|
(748)
|
Operating free cash flow
|
$m
|
1,691
|
1,827
|
Table H: Net debt and leverage
Description
|
Unit of
measure
|
As at
|
As at
|
March 2024
|
March 2023
|
Long term borrowing, net of current
portion
|
$m
|
947
|
1,233
|
Short-term borrowings and current
portion of long-term borrowing
|
$m
|
1,426
|
945
|
Add: Processing costs related to
borrowings
|
$m
|
8
|
7
|
Less: Fair value hedge
adjustment
|
$m
|
(1)
|
(5)
|
Less: Cash and cash
equivalents
|
$m
|
(620)
|
(586)
|
Less: Term deposits with
banks
|
$m
|
(344)
|
(117)
|
Add: Lease liabilities
|
$m
|
2,089
|
2,047
|
Net debt
|
$m
|
3,505
|
3,524
|
EBITDA (LTM)
|
$m
|
2,428
|
2,575
|
Leverage (LTM)
|
times
|
1.4x
|
1.4x
|
Table I: Return on capital employed
Description
|
Unit of
measure
|
Year ended
|
March 2024
|
March 2023
|
Operating profit (LTM)
|
$m
|
1,640
|
1,757
|
Equity attributable to owners of
the Company
|
$m
|
2,160
|
3,635
|
Add: Put option given to minority
shareholders 1
|
$m
|
552
|
569
|
Gross equity attributable to owners of the Company
1
|
$m
|
2,712
|
4,204
|
Non-controlling interests
(NCI)
|
$m
|
140
|
173
|
Net debt (refer Table H)
|
$m
|
3,505
|
3,524
|
Capital employed
|
$m
|
6,357
|
7,901
|
Average capital employed 1
|
$m
|
7,130
|
7,536
|
Return on capital employed
|
%
|
23.0%
|
23.3%
|
(1) Average capital employed is calculated as average of capital
employed at closing and opening of relevant period.
Note on exceptional
items
"Exceptional items refer to items
of income or expense within the consolidated statement of
comprehensive income, which are of such size, nature or incidence
that their exclusion is considered necessary to explain the
performance of the Group and improve the comparability between
periods. Reversals of previous exceptional items are also
considered as exceptional items. When applicable, these items
include amongst others, currency devaluation of local currencies
against the US Dollar, network modernisation, share issue expenses,
loan prepayment costs, the settlement of legal and regulatory
cases, restructuring costs, impairments, gain on sale of tower
assets and the initial recognition of deferred tax assets
etc.
The Group has US Dollar
liabilities in subsidiaries in which the US Dollar is not the
functional currency. Changes in the US Dollar exchange rate against
the relevant functional currency leads to foreign exchange gains or
losses recorded in the statement of comprehensive income. With
respect to the classification of whether these gains or losses, as
a result of the devaluation of local currencies against the US
Dollar, as an exceptional item, the Group presents the impact as an
exceptional item only if a particular currency has devalued (or
appreciated) due to a structural change in the local market (for
example as a result of changes in government policy) or the
devaluation in a month is more than a threshold percentage. The
devaluation is also only reported as exceptional if the resultant
impact on the Group's profit before tax is higher than a monetary
threshold. Reversals of foreign exchange losses as a result of the
above are also reported as exceptional. The Group continues to
review its exceptional items policy to align it to changes in the
macro-economic environment. For the current year, this did not have
a change on the amounts reported as exceptional items."
Statement of Director's Responsibilities
We confirm that to the best of our
knowledge:
a) The financial
statements, prepared in accordance with the relevant financial
reporting framework, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the company
and the undertakings included in the consolidation taken as a
whole.
b) The
management report includes a fair review of the development and
performance of the business and the position of the company, and
the undertakings included in the consolidation taken as a whole,
together with a summary description of the principal risks and
uncertainties that they face.
c) The financial
statements include disclosure of related parties' transactions that
have taken place during the year and that have materially affected
the financial position or performance of the company.
This responsibility statement was
approved by the board of directors on 08 May 2024 and is signed on
its behalf by:
Segun Ogunsanya
Chief Executive Officer
08 May 2024
Glossary
Technical and Industry Terms
4G data customer
|
A customer having a 4G handset and who has used at
least 1 MB on any of the Group's GPRS, 3G and 4G network in the
last 30 days.
|
Airtel Money (mobile money)
|
Airtel Money is the brand name for Airtel Africa's
mobile money products and services. The term is used
interchangeably with 'mobile money' when referring to our mobile
money business, finance, operations and activities.
|
Airtel Money ARPU
|
Mobile money average revenue per user per month.
This is derived by dividing total mobile money revenue during the
relevant period by the average number of active mobile money
customers and dividing the result by the number of months in the
relevant period.
|
Airtel Money customer base
|
Total number of active subscribers who have enacted
any mobile money usage event in last 30 days.
|
Airtel Money customer penetration
|
The proportion of total Airtel Africa active mobile
customers who use mobile money services. Calculated by dividing the
mobile money customer base by the Group's total customer base.
|
Airtel Money transaction value
|
Any financial transaction performed on Airtel
Africa's mobile money platform.
|
Airtel Money transaction value per customer per
month
|
Calculated by dividing the total mobile money
transaction value on the Group's mobile money platform during the
relevant period by the average number of active mobile money
customers and dividing the result by the number of months in the
relevant period.
|
Airtime credit service
|
A value-added service where the customer can take an
airtime credit and continue to use our voice and data services,
with the credit recovered through subsequent customer recharge.
This is classified as a Mobile Services product (not a Mobile Money
product).
|
ARPU
|
Average revenue per user per month. This is derived
by dividing total revenue during the relevant period by the average
number of customers during the period and dividing the result by
the number of months in the relevant period.
|
Average customers
|
The average number of active customers for a period.
Derived from the monthly averages during the relevant period.
Monthly averages are calculated using the number of active
customers at the beginning and the end of each month.
|
CBN
|
Central Bank of Nigeria
|
Capital expenditure
|
An alternative performance measure (non-GAAP).
Defined as investment in gross fixed assets (both tangible and
intangible but excluding spectrum and licences) plus capital work
in progress (CWIP), excluding provisions on CWIP for the
period.
|
Constant currency
|
The Group has presented certain financial
information that is calculated by translating the results at a
fixed 'constant currency' exchange rate, which is done to measure
the organic performance of the Group and represents the performance
of the business in a better way. Constant currency amounts and
growth rates are calculated using closing exchange rates as of 31
March 2023 for all reporting regions and service segments except
for Nigeria region and service segment. For the Nigeria region and
service segment, constant currency amounts and growth rates have
been calculated using the closing exchange rate prevailing as of 30
June 2023
In June 2023, the Central Bank of Nigeria (CBN)
announced changes to the operations in the Nigerian Foreign
Exchange Market, including the abolishment of segmentation, with
all segments now collapsing into the Investors and Exporters
(I&E) window and the reintroduction of the 'Willing Buyer,
Willing Seller' model at the I&E window. As a result of this
CBN decision, the Nigerian naira has devalued against US Dollar by
approximately 62%. This change announced by CBN led to a material
impact on the Group's financial statements and for better
representation of the performance of the business and comparability
the closing exchange rate prevailing as of 30 Jun 2023 i.e. NGN
752.2/USD has been used for calculation of constant currency
amounts and growth rates of Nigeria region and service segment.
|
Customer
|
Defined as a unique active subscriber with a unique
mobile telephone number who has used any of Airtel's services in
the last 30 days.
|
Customer base
|
The total number of active subscribers that have
used any of our services (voice calls, SMS, data usage or mobile
money transaction) in the last 30 days.
|
Data ARPU
|
Data average revenue per user per month. Data ARPU
is derived by dividing total data revenue during the relevant
period by the average number of data customers and dividing the
result by the number of months in the relevant period.
|
Data customer base
|
The total number of subscribers who have consumed at
least 1 MB on the Group's GPRS, 3G or 4G network in the last 30
days.
|
Data customer penetration
|
The proportion of customers using data services.
Calculated by dividing the data customer base by the total customer
base.
|
Data usage per customer per month
|
Calculated by dividing the total MBs consumed on the
Group's network during the relevant period by the average data
customer base over the same period and dividing the result by the
number of months in the relevant period.
|
Digitalisation
|
We use the term digitalisation in its broadest sense
to encompass both digitisation actions and processes that convert
analogue information into a digital form and thereby bring
customers into the digital environment, and the broader
digitalisation processes of controlling, connecting and planning
processes digitally; the processes that effect digital
transformation of our business, and of industry, economics and
society as a whole through bringing about new business models,
socio-economic structures and organisational patterns.
|
Diluted earnings per share
|
Diluted EPS is calculated by adjusting the profit
for the year attributable to the shareholders and the weighted
average number of shares considered for deriving basic EPS, for the
effects of all the shares that could have been issued upon
conversion of all dilutive potential shares. The dilutive potential
shares are adjusted for the proceeds receivable had the shares
actually been issued at fair value. Further, the dilutive potential
shares are deemed converted as at beginning of the period, unless
issued at a later date during the period.
|
Earnings per share (EPS)
|
EPS is calculated by dividing the profit for the
period attributable to the owners of the company by the weighted
average number of ordinary shares outstanding during the
period.
|
Foreign exchange rate movements for non-DTA
operating companies
and holding companies
|
Foreign exchange rate movements are specific items
that are non-tax deductible in a few of our operating entities,
hence these hinder a like-for-like comparison of the Group's
effective tax rate on a period-to-period basis and are therefore
excluded when calculating the effective tax rate.
|
Indefeasible Rights of Use (IRU)
|
A standard long-term leasehold contractual agreement
that confers upon the holder the exclusive right to use a portion
of the capacity of a fibre route for a stated period.
|
Information and communication technologies (ICT)
|
ICT refers to all communication technologies,
including the internet, wireless networks, cell phones, computers,
software, middleware, videoconferencing, social networking, and
other media applications and services.
|
Interconnect user charges (IUC)
|
Interconnect user charges are the charges paid to
the telecom operator on whose network a call is terminated.
|
Lease liability
|
Lease liability represents the present value of
future lease payment obligations.
|
Leverage
|
An alternative performance measure (non-GAAP).
Leverage (or leverage ratio) is calculated by dividing net debt at
the end of the relevant period by the EBITDA for the preceding 12
months.
|
Minutes of usage
|
Minutes of usage refer to the duration in minutes
for which customers use the Group's network for making and
receiving voice calls. It includes all incoming and outgoing call
minutes, including roaming calls.
|
Mobile services
|
Mobile services are our core telecom services,
mainly voice and data services, but also including revenue from
tower operation services provided by the Group and excluding mobile
money services.
|
Net debt
|
An alternative performance measure (non-GAAP). The
Group defines net debt as borrowings including lease liabilities
less cash and cash equivalents, term deposits with banks,
processing costs related to borrowings and fair value hedge
adjustments.
|
Net debt to EBITDA (LTM)
|
An alternative performance measure (non-GAAP)
Calculated by dividing net debt as at the end of the relevant
period by EBITDA for the preceding 12 months (from the end of the
relevant period). This is also referred to as the leverage
ratio.
|
Network towers or 'sites'
|
Physical network infrastructure comprising a base
transmission system (BTS) which holds the radio transceivers (TRXs)
that define a cell and coordinates the radio link protocols with
the mobile device. It includes all ground-based, roof top and
in-building solutions.
|
Operating company (OpCo)
|
Operating company (or OpCo) is a defined corporate
business unit, providing telecoms services and mobile money
services in the Group's footprint.
|
Operating free cash flow
|
An alternative performance measure (non-GAAP).
Calculated by subtracting capital expenditure from EBITDA.
|
Operating leverage
|
An alternative performance measure (non-GAAP).
Operating leverage is a measure of the operating efficiency of the
business. It is calculated by dividing operating expenditure
(excluding regulatory charges) by total revenue.
|
Operating profit
|
Operating profit is a GAAP measure of profitability.
Calculated as revenue less operating expenditure (including
depreciation and amortisation and operating exceptional items).
|
Other revenue
|
Other revenue includes revenues from messaging,
value added services (VAS), enterprise, site sharing and handset
sale revenue.
|
Reported currency
|
Our reported currency is US dollars. Accordingly,
actual periodic exchange rates are used to translate the local
currency financial statements of OpCos into US dollars. Under
reported currency the assets and liabilities are translated into US
dollars at the exchange rates prevailing at the reporting date
whereas the statements of profit and loss are translated into US
dollars at monthly average exchange rates.
|
Smartphone
|
A smartphone is defined as a mobile phone with an
interactive touch screen that allows the user to access the
internet and additional data applications, providing additional
functionality to that of a basic feature phone which is used only
for making voice calls and sending and receiving text messages.
|
Smartphone penetration
|
Calculated by dividing the number of smartphone
devices in use by the total number of customers.
|
Total MBs on network
|
Includes total MBs consumed (uploaded and
downloaded) on the network during the relevant period.
|
EBIT
|
Defined as operating profit/(loss) for the period
adjusted for exceptional items.
|
EBITDA
|
An alternative performance measure (non-GAAP).
Defined as operating profit before depreciation, amortisation and
exceptional items.
|
EBITDA margin
|
An alternative performance measure (non-GAAP).
Calculated by dividing EBITDA for the relevant period by revenue
for the relevant period.
|
Revenue
|
An alternative performance measure (non-GAAP).
Defined as revenue before exceptional items.
|
Unstructured Supplementary Service
Data
|
Unstructured Supplementary Service
Data (USSD), also known as "quick codes" or "feature codes", is a
communications protocol for GSM mobile operators, similar to SMS
messaging. It has a variety of uses such as WAP browsing, prepaid
callback services, mobile-money services, location-based content
services, menu-based information services, and for configuring
phones on the network.
|
Voice minutes of usage per customer per month
|
Calculated by dividing the total number of voice
minutes of usage on the Group's network during the relevant period
by the average number of customers and dividing the result by the
number of months in the relevant period.
|
Weighted average number of shares
|
The weighted average number of shares is calculated
by multiplying the number of outstanding shares by the portion of
the reporting period those shares covered, doing this for each
portion and then summing the total.
|
Abbreviations
2G
|
Second-generation mobile technology
|
3G
|
Third-generation mobile technology
|
4G
|
Fourth-generation mobile technology
|
5G
|
Fifth-generation mobile technology
|
ARPU
|
Average revenue per user
|
bn
|
Billion
|
bps
|
Basis points
|
CAGR
|
Compound annual growth rate
|
Capex
|
Capital expenditure
|
CSR
|
Corporate social responsibility
|
DTA
|
Deferred Tax Asset
|
EBIT
|
Earnings before interest and tax
|
EBITDA
|
Earnings before interest, tax, depreciation and
amortisation
|
EPS
|
Earnings per share
|
FPPP
|
Financial position and prospects procedures
|
GAAP
|
Generally accepted accounting principles
|
GB
|
Gigabyte
|
HoldCo
|
Holding company
|
IAS
|
International accounting standards
|
ICT
|
Information and communication technologies
|
ICT (Hub)
|
Information communication technology (Hub) IFRS
|
IFRS
|
International financial reporting standards
|
IMF
|
International monetary fund
|
IPO
|
Initial public offering
|
KPIs
|
Key performance indicators
|
KYC
|
Know your customer
|
LTE
|
Long-term evolution (4G technology)
|
LTM
|
Last 12 months
|
m
|
Million
|
MB
|
Megabyte
|
MI
|
Minority interest (non-controlling interest)
|
NGO
|
Non-governmental organisation
|
OpCo
|
Operating company
|
P2P
|
Person to person
|
PAYG
|
Pay-as-you-go
|
QoS
|
Quality of service
|
RAN
|
Radio access network
|
SIM
|
Subscriber identification module
|
Single RAN
|
Single radio access network
|
SMS
|
Short messaging service
|
TB
|
Terabyte
|
Telecoms
|
Telecommunications
|
Unit of measure
|
Unit of measure
|
USSD
|
Unstructured supplementary service
data
|