Airtel Malawi has delivered a strong performance in its first half report of the year, growing 113%.
Airtel Malawi has reported a profit of K18.9 billion ($17.67m) for June 2023, an increase by 133% from the K8.9 billion ($8.28m) it reported a year ago. In an environment where its contemporaries reported losses owing to currency devaluation, Airtel Malawi is an outlier.
Airtel’s Malawi’s uptick in its financial statement does not represent the current state of the external shocks and severe macro-fiscal imbalances the country suffered in the last three years. In June 2023, a spokesperson for Malawi’s central bank said the foreign exchange reserves of the East African nation could not cover a month of imports. But respite came when the Reserve Bank of Malawi, in a foreign exchange auction, raised $350,000 that same month to cater to forex shortage.
Airtel Malawi’s resilience is thus unprecedented as its profit is attributed to a better operating performance and lower finance costs. The telco reduced its foreign exchange losses to K2.8 billion ($2.66m) in June 2023 from K12.6 billion ($11.77 million) the year before. “The Malawi Kwacha depreciated by 2.68% in June 2023 as against a foreign exchange loss of K12,652 million in the previous year, same period, when the Malawi kwacha depreciated by more than 25%,” the notes in the financial statements read.
The firm’s revenue was up 26.8% to K85.9 billion ($80m) from K67.8 billion ($63.11m) recorded in June 2022. The revenue growth was based on the customer base growth of 5.8%, and average revenue per user (ARPU) growth of 20.7%. The revenue growth was broad-based across all key segments: voice revenue went up by 16.9%; data revenue was up by 30.4%; and other revenue was up by 86.7%.
Airtel Malawi is going nowhere despite the nation’s economic woes
Airtel Malawi said it will continue to support the economy and keep Malawian communities connected. Its outlook on Malawi is attractive, as it notes that the telecommunication sector would benefit from population growth and the need for increased connectivity. While it wants to base its forward-looking strategy on increasing mobile penetration via rural underserved markets, the economy is a worrying concern. “The economy and company are exposed to [the] continued impact of Kwacha depreciation and scarcity of foreign currency,” the notes in its statements read. The telco said it will sort the problem by diversifying currency sourcing while doubling down on revenue and customer growth.
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