Bharti Airtel Registers Notable Operational Profit in Africa as Indian Market Slumps

Airtel Africa

Bharti AirtelIndia’s Bharti Airtel has announced its consolidated results for the fourth quarter ended March 31, 2018.

Before we can look into the specifics of the report’s specifics, it worth noting the company has registered a drop in a number of keys sections. For instance, its consolidated total revenues are down by 9.8 percent Y-O-Y on an underlying basis. The same drop has been noted on net income (by 71.1% Y-O-Y), as well as consolidated EBITDA that slipped by 14.5 percent. The operator’s primary market revenues (India) have also dropped by 7.5 percent Y-o-Y.

On the bright side of things, its overall customer base stands at an impressive 413.8 million in the 16 countries it runs its operations. Furthermore, the telco has rolled out more than 107,000 mobile broadband base stations in India.

In addition, the telco concluded the acquisition of Tigo Rwanda with its 3 million customers.

Although revenues in India declined, Africa-based revenues grew by 10.7 percent YoY. The primary reason behind this jump is attributed to a notable demand for data services. Locally, Airtel Kenya registered a slight growth in its subscriber base based on Kenya’s Communications Authority report that was released a few days ago.

While mobile money services are dominated by Safaricom’s M-PESA (Airtel Money is still growing), the service contributed to Africa’s quarterly gains. We hope Airtel Kenya will make key strides in this sector after mobile money interoperability went live a few weeks ago.

“The telecom industry continues to witness below cost, artificially suppressed pricing. Industry revenues were further adversely impacted this quarter due to the reduction in International termination rates. Airtel continued to consolidate its leadership position this quarter. Our strategic investments in data capacities, innovative digital content through Airtel TV, customer friendly bundles and upgrade programs led to the highest ever mobile data customer additions of 15 Mn during the quarter. Usage parameters remained robust– on a YOY basis, we saw data and voice traffic grow 584% and 55% respectively.

In line with our goal of building market-leading 4G networks, with best in class speeds and capacity; while supporting the Digital India initiative, we have ended the financial year with our highest ever capital expenditure of Rs 240 Bn. We intend to continue the rollout momentum next year as well,” noted Mr. Gopal Vittal, MD and CEO, India & South Asia.

Airtel Kenya, which has since rolled out LTE services (making it the fourth Kenyan telco to do so after Safaricom, Telkom Kenya, and Faiba 4G), is not doing very well as far profit margins are concerned. There are unsubstantiated rumours that suggest a possible merger with Telkom Kenya. Mergers are complex by design; hence, we will not be surprised if such conversations are dismissed as speculative should the talks fail – if they exist in the first place.