Safaricom’s net profit soars 38pc to record Sh32bn

Corporate News

Safaricom chief executive Bob Collymore. The firm has announced full year results showing a 38 per cent rise in net income. PHOTO | FILE 

By BDAfrica.com REPORTER

In Summary

• Total revenue increased 13 per cent to Sh163.4 billion, with the mobile giant’s customer base growing to 23.3 million.
• Non-voice revenue — which includes income from services such as M-Pesa — grew 27 per cent to Sh68.8 billion.

Safaricom has announced full year results for the year ended March 31, 2015 showing a 38 per cent rise in profit after tax from Sh23 billion to Sh31.9 billion, with much of the growth coming from non-voice services

Total revenue increased 13 per cent to Sh163.4 billion, with the mobile giant’s customer base growing eight per cent to 23.3 million.

Non-voice revenue — which mainly includes income from data and the M-Pesa mobile money service — grew 27 per cent to Sh68.8 billion, accounting for 42 per cent of total revenue. Okoa Jahazi emergency top-ups rose 32 per cent.

Voice income, meanwhile, was only up four per cent to Sh87.4 billion.

“MPesa, now contributing 20 per cent of total revenue, continues to be a significant driving factor in our growth,” CEO Bob Collymore said, pointing to increases in active MPesa customers as well as average number of transactions per customer.

“Mobile data revenue grew at an impressive 59 per cent, driven by an increased uptake of affordable data bundles and a 21 per cent growth in 30-day active data customers.” 

The firm used the event to launch Safaricom’s home broadband solution, “a set-top box that brings the 3G and 4G network into the home, and distributes the superfast connectivity via wi-fi to any device” as well as Kenyan digital free-to-air TV channels to the customers’ TV.

Dubbed ‘The Big Box’, it is expected to drive growth in data with the mobile giant planning to introduce video-on-demand and other content “in the coming year”. Promotional material for the product promises free YouTube access for the first three months.

The mobile provider also announced the rollout of a high speed 4G internet connection in Nairobi and Mombasa. The rollout is expected to extend to 13 towns by year end.

“The board recommends a dividend of Sh0.64 per share, an increase of 36 per cent (from the previous year),” Collymore said. “Pending approval by shareholders we will pay out a dividend of Sh25.64 billion… once again, the largest dividend in Kenyan history.”

Chairman Nicholas Ng’ang’a announced that the company’s board has extended Collymore’s contract for two years.

Safaricom’s share price on Wednesday rose to an all-time high of Sh17.90 with investors expecting record profits to be announced.

With a market capitalisation north of Sh700 billion, it is now almost as big as the next four largest listed companies combined: EABL (Sh257 billion), KCB (Sh180 billion), Equity Group (Sh174 billion) and Co-operative Bank (Sh107 billion).