Safaricom in Sh25.5bn pre-tax profit

May 14, 2013
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The profits were driven by growth in total revenue which went up by 16 percent to Sh124.3 billion/FILE
The profits were driven by growth in total revenue which went up by 16 percent to Sh124.3 billion/FILE
NAIROBI, Kenya, May 14 – Safaricom has announced a 47 percent increase in pre-tax to Sh25.5 billion for its full financial year ending March 31, 2013 from Sh17.3 billion in the previous year.

The profits were driven by growth in total revenue which went up by 16 percent to Sh124.3 billion.

Growth in service revenue hit Sh118.1 billion with voice revenue going up by 13 percent to Sh77.7 billion and non-voice service revenue increased by 29 percent to Sh40.4 billion.

“The full year results demonstrate our continued strong commercial and financial performance across our service portfolio, we are committed to our ‘Best Network in Kenya’ initiative through continued investment in our network and services “Safaricom CEO Bob Collymore said while commenting on the results.

Collymore says following the impressive performance, the company’s shareholders will receive 31 cents per share dividend payout from 22 cents last year representing a 41 percent increase.

Collymore announced 30 percent growth in SMS revenue to Sh10.13 billion, 21 percent growth in mobile data revenue to Sh6.3 billion and percent increase in active mobile data customers to 7.1 million which is 37 percent of total customer base.

“M-PESA continues to be a major revenue driver contributing Sh21.8 billion, 18 percent of total revenue. In line with our growth strategy to make M-PESA services accessible to all our customers, we expanded our agent footprint by 66 percent and closed the year with 65,547 agents up from 39,401 agents in the previous year,” he announced.

“We know the challenge ahead for the SMS is the upcoming instant messaging services like ‘whatsApp’ where most people especially the young people have focused and we feel this may have an impact. But because we have relatively low penetration level of smartphones, the option for customers is not there. However we keep adopting new innovations and we will follow our customers’ needs,” he added.

Total customers increased by 1.8 percent to 19.42 million from 19.07 million in the previous year while the number of registered M-PESA customers grew by 14.8 percent to 17.11 million compared to 14.91 million as at March 2012.

However operating costs went up 10 percent during the period from Sh26.3 billion to Sh28.2 billion.

“Our direct costs increased by 6 percent but it balanced well with our 16 percent increase in total revenue. The costs were directly focused interconnection charges, spectrum management and scratch cards production among other key operations that the business cannot do without,” said Safaricom Chief Finance Officer John Tombleson.

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