Profits–Safaricom’s profits have plunged down from sh 67.5 to sh 52.5; this being a 22.2 percent fall for the year ended March 2023.
The East Africa’s largest company headquartered in Nairobi, saw its overall revenues increase 4.3% to sh 310.9 billion, up from sh 298 billion the previous year. Earnings before interest, tax, depreciation and amortization (EBITDA) fell 6.2% from the previous year to hit sh 139.9 billion.
“This year, we all experienced tough headwinds, including high inflation, a depreciating shilling, severe drought, and failed rain seasons among others,” Safaricom CEO Peter Ndegwa, alluding to the larger macro-economic downturn in Kenya.
The The telco’s board recommended a dividend per share of Ksh1.20, a 13.7 percent decline from the previous year.
Describing the performance as ‘solid’, Safaricom CEO Peter Ndegwa vowed to prioritize improving services and continued expansion of Safaricom’s product range.
“We are committed to continue investing in our network infrastructure, broadening our product range, and leveraging emerging technologies to enhance our participation in the digital ecosystem,” he stated. He further promised increased support for the company’s sustainability and social responsibility programs.
Mobile money remained a key growth driver for Safaricom. M-Pesa revenues grew by 8.8% to hit sh117.2 billion. With Safaricom receiving a license to launch M-Pesa in Ethiopia on May 10, the company’s mobile money revenues are expected to keep growing.
Ndegwa also talked up the government-backed Hustler Fund credit scheme launched by President William Ruto last year for introducing more customers to Safaricom’s ecosystem.
“When Hustler Fund came into our ecosystem, we saw 2 million additional new customers coming on who were not using our services,” he disclosed.
Safaricom chair Adil Khawaja noted that this decline in profitability could have been triggered by many factors including depressed economic activity during the electioneering period and the Communication Authority’s move to cut mobile termination rates (MTRs), which ate into Safaricom revenues.
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