Safaricom’s Half Year Profits Up To 37.1 Billion Shillings

Kenya’s giant telecommunications company Safaricom PLC has registered yet what can be described as “crazy profits” with the half-year profits after tax standing at 37.1 billion shillings. This was a 12.1 percent increase from what was registered at the same time in 2020.

The profits before tax stood at 54.7 billion shillings, an increase of 22.2 percent from what was registered in 2020.

From the numbers, service revenue for Safaricom during the period contributed 138.4 billion shillings while handsets and other revenue brought in 7.8 billion shillings. Total revenue stood at 146.4 billion shillings. Free cash flow was at 34.4 billion shillings.

Net income grew at 12.1 percent supported by growth in EBIT. This was partly weighed down by financing costs and higher tax after-tax rates reverted to 30 percent compared to 25 percent last year.

Currently, Safaricom controls 64.2 percent of the market share and 68.2 percent of voice traffic share. The company crossed the 40 million total customer mark, 31.75 mobile customers, 198,000 fixed customers.

Earnings Before Interest and Taxes (EBIT) recorded a 28.8% YoY growth. I’m happy to also report that the EBIT margin grew by 3.3ppts compared to H1 last year.

Service revenue grew by 16.9 percent to 138.4 billion shillings. At the same time, Mpesa Revenues grew by 45.8 percent to 52.3 billion shillings.

The M-Pesa super app has 4 million downloads (2 million active users) – it has 17 mini-apps, with 65 others under development. The business app is now used by 320,000 organizations.

“During this period, we managed a Kshs 2.3B OPEX savings thanks to initiatives such as smart procurement and planning, helping the business to be more efficient while delivering more value to our customers,” said CEO Peter Ndegwa.

During the period, M-Pesa now has 28.7 million customers using the service every month with 3.9 million customers using the M-Pesa Super App. The value of M-Pesa is now at 13.7 trillion shillings of which 18.1 percent is still zero-rated.

Safaricom has also launched an M-Pesa Fintech 2.0 platform with plans to add wealth and insurance services once approved by regulators.