Safaricom is promising to retain its annual capital spending in
rolling out new products and services to address evolving needs of
society. This as it aims to build on its Ksh73.66 billion net profit.
The
telco is preparing for its virtual annual general meeting (AGM) on July
31, when shareholders will get an opportunity to know the plans for the
current financial year.
Safaricom’s net profit grew by
17.9 percent to Sh73.66 billion in the year ended March 2020 as it
ushered in a new CEO, Peter Ndegwa, the first Kenyan to lead the
business.
Mr Ndegwa says that consistent focus on
investment in the company’s infrastructure and innovative platforms and
services has been the key driver in strong performance over the year, a
feat he wants to build on.
“We will continue to develop
new digital products and services that solve societal challenges in
agriculture, health, education and essential services,” says Mr Ndegwa.
“Leveraging the power of partnerships and our digital platforms,
we will drive affordability and innovation in mobile communication,
financial services and enterprise solutions, while maintaining our
leadership in the best network handset.”
The telco has
been automating internal and customer-facing operations and enhancing
use of artificial intelligence, all which Mr Ndegwa will be taking to
the next level.
Safaricom has been consistently growing
profits for the last eight years, with the net earnings having grown
nearly six times when compared with Sh12.63 billion profit in 2012.
The
company’s capital expenditure has been averaging Sh36 billion to Sh40
billion, giving room for the company to roll out new products to deliver
fresh revenue streams and retain an edge over its competitors.
The AGM is being held in the period of Covid-19, which has brought to the fore the importance of technology.
Safaricom
will be seeking to amend its articles of association to allow for
electronic AGM or a hybrid of electronic and physical meetings going
forward.
This will eliminate the need for getting a
special window to hold virtual meetings if it opts to. The current
company Act does not have a clause on virtual meetings. Listed firms
have to seek a special window for such meetings.
Shareholders
will use the meeting to approve a final dividend of Sh1.40 per share,
up from Sh1.25 per share paid in the previous year. The pay-out will
amount to Sh56.09 billion, and will be disbursed by end of August.
“The
board is committed to investing in the business and maintaining our
strong record of paying progressive dividends each year,” states
outgoing CEO Michael Joseph.
Safaricom has also taken
bold steps to support customers enduring the economic strains of
Covid-19 restrictions. Among the measures it took included allowing
M-Pesa users to send up to Sh1,000 for free and ensuring a stable
network and data services for the many people working from home.
“We
have made some significant decisions in recent months to support
customers and ensure Kenyans can spend their money where they need it
most. Our current support is valued at Sh6.5 billion,” states the
chairman, Nicholas Ng'ang'a.
Eyes will be on the new boss, Mr Ndegwa, as he steers the company through its growth path.
Mr
Joseph handed the management reins to Mr Ndegwa in April, having
launched a new customer proposition – “For You” – that promises “simple,
transparent and honest” service.
He reckons that the
proposition has already delivered improved customer sentiment, greater
brand consideration and a gain in market share for the first time since
2017.
Mr Ndegwa says he wants to see many more
businesses such as micro, small and medium-sized enterprises benefiting
from the digital investments of the telco just as retail businesses
have.
“Looking ahead, Safaricom has always been a
pioneer and I am committed to continuing this path to tap into the vast
opportunity,” says Mr Ndegwa.
The telco has been on the
frontline in identifying innovations to improve on customer service
delivery, and Mr Ndegwa is pledging to retain this in the next phase of
growth.
“We will stay true to who we are to the society, both within Kenya and as we begin to expand out in the region.”
“We will continue to develop new digital products and services that solve societal challenges in agriculture, health, education and essential services,” Mr Peter Ndegwa, Safaricom CEO.
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