Key Highlights From Safaricom’s Half-Year Results

Safaricom released financial results for the half-year ended 30^th September 2020 which saw net profit decreased by 6 percent to 33.07 billion shillings with service revenue hitting 118.41 billion shillings.

“Our business has proved to be resilient despite tough operating conditions. There is no doubt that COVID-19 has dealt a huge blow to many people not just in Kenya, but across the globe,” noted Mr. Peter Ndegwa, CEO Safaricom.

Despite a 4.8 percent drop in Service Revenue, Safaricom increased capital expenditure by  25.5 percent to 22.75 billion shillings, signaling investment commitment to building a network infrastructure that supports the country’s economic development.

Voice service revenue dropped by 6.5% to KES 40.19 billion while M-PESA revenue dropped by 14.5 percent to 35.89 billion shillings.

Here are the key highlights

10.5% decline in EBIT (Earnings before Interest and Tax) to KES 44.97bn with an EBIT margin of 36.3%, down 2.5ppts YoY.

Net Income reduced by 6.0% to KES 33.07bn.

Free Cash Flow down 36.8% to KES 23.60bn.

Service revenue contracted by 4.8% to KES 118.41bn.

Voice service (outgoing) revenue reduced by 6.5% to KES 40.19bn.

M-PESA revenue dropped by 14.5% to KES 35.89bn.

Mobile data revenue increased by 14.1% to KES 22.23bn.

Messaging revenue declined by 6.9% to KES 7.19bn.

Total one month active customer base increased by 10.2% to 30.31m.

One month active M-PESA customers increased 13.5% to 26.79m.

One month active mobile data customers increased 11.6% to 22.91m.

“The Board is encouraged by the positive trajectory witnessed going into the second quarter of our financial year. We remain steadfast in ensuring management continues to build on the strong company position that has been established over the last 20 years, running a purpose-driven business, that continues to transform lives and drive future growth,” said Michael Joesph, Chairman, Safaricom Board of Directors.

The continued focus on customers led to a 10.2% increase in one month active subscribers for the period, with customers growing across all revenue streams. With the new business strategy and the renewed focus on the customer, Safaricom expects to build on this momentum that has been gained during the second quarter of the period under review.