By Eddah Waithaka
Safaricom PLC has reported a robust net income of KES 28.1 billion attributable to equity holders for the six months ending September 30, 2024, reflecting a significant boost in financial performance. The company’s impressive results were fueled by a double-digit growth of 12.9% in service revenue within its Kenyan operations, which soared to KES 177.5 billion.
This surge contributed to an 18.0% increase in EBIT, reaching KES 79.2 billion, while net income climbed by 14.1% to KES 47.5 billion, underscoring Safaricom’s strong position in the market and its successful execution of strategic initiatives.
Speaking while announcing the Half Year Results, Dr. Peter Ndegwa, CEO Safaricom PLC said, “This performance, which comes at a time when we are marking 24 years of connecting and transforming Kenyans’ lives, reflects the relentless execution of our strategy. We are proud of the value that we have given our customers through use of technology, and we will continue growing our core business while expanding into new services through our innovative spirit.”
In a noteworthy development, Safaricom PLC showcased resilience and agility amidst challenging economic conditions. While the group’s service revenue experienced a robust growth of 13.1%, totaling KES 179.9 billion, and EBIT increased by 1.8% to KES 42.2 billion, net income reflecting underlying performance soared by 27.1% to KES 36.7 billion. However, reported net income excluding minority interest saw a contraction of 17.7%, settling at KES 28.1 billion.
This decline was primarily attributed to the adverse effects of Ethiopia’s ongoing foreign exchange regime reforms and the complexities of hyperinflationary accounting, highlighting the multifaceted challenges the company faces in the broader East African market. Despite these hurdles, Safaricom remains well-positioned to navigate the evolving landscape and capitalize on growth opportunities.
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Safaricom Group’s mobile connectivity business, comprising of voice, data and SMS, contributed 52.2% of revenue at KES 93.9 billion, while M-PESA contributed 42.9%, at KES 77.2 billion.
Adil Khawaja, Safaricom’s Board Chairman said, “The Board is pleased with the great performance recorded in the period under review. We remain focused on our vision of becoming Africa’s leading purpose-led technology company as we advance our propositions in both Ethiopia and Kenya.”
In Ethiopia, where Safaricom has successfully established a network that now covers 46% of the population, the company has seen a remarkable 47.3% growth in its customer base, reaching 6.1 million monthly active users. Notably, data consumption among these users has soared, averaging 6.6GB per person, a significant increase when compared to Kenya’s 4.1GB.
To address the short-term challenges posed by ongoing foreign exchange regime reforms, Safaricom Ethiopia has implemented a series of strategic initiatives. These include renegotiating contracts in foreign currencies, integrating local suppliers for various products and services, and reducing the number of expatriates on its team. Through these proactive measures, Safaricom is not only navigating the current complexities but is also setting a strong foundation for sustainable growth in the Ethiopian market.
