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JUST IN: Nigeria’s Currency Devaluation Hits Airtel Africa Losses Over $4m, Says Only $550m Left for Debt Repayment

JUST IN: Nigeria’s Currency Devaluation Hits Airtel Africa Losses Over $4m, Says Only $550m Left for Debt Repayment

Airtel Africa Plc, just like the MTN Group was badly hit by the currency devaluation of the Nigerian Government thereby resulting to losses of up to $4,979 million, which was a decline of  5.3%, and leaving the telecom operator with $550 million for debt payment in May 2024.

The Group in its year ended 31 March 2024 financial report also revealed that it recorded loss after tax of  $89 million, primarily impacted by significant foreign exchange headwinds, resulting in a $549 million exceptional loss net of tax following the Nigerian naira devaluation in June 2023 and Q4’24, and the Malawian kwacha devaluation in November.

According the Pan-African telecommunications company, basic Earnings per share (EPS) were primarily impacted by significant derivative and foreign exchange losses during the  EPS before exceptional items and derivative, and that foreign exchange losses was 18.3 cents compared to 20.5 cents in the prior period.

“Capex was broadly flat at $737m and was below our guidance largely due to a deferral in data centre In addition, we invested $152m in licence renewal and spectrum acquisitions, including $127m for the Nigerian 3G licence renewal”, the company said.

It added, “leverage of 1.4x on 31 March 2024 was flat from the previous year. We have around $680m of cash available at HoldCo, to be utilized to fully repay the remaining $550m debt, falling due in May.”

However, the company said that the Board has approved a share buyback programme of up to $100 million, over a period of up to 12 On 1 March 2024, “we announced the commencement of the first tranche of this buyback up to a maximum of $50m. During March 2024, the company purchased 7.4 million shares for a total consideration of $9 million.”

It also recommended a final dividend of 57 cents per share, making the total dividend for FY24 5.95 cents per share.

Commenting on the trading update, Chief Executive Officer, Olusegun Ogunsanya, said, “The consistent deployment of our ‘Win with’ strategy supported the acceleration in constant currency revenue growth over the recent quarters which has reduced the impact of currency headwinds faced across most of our markets. This strong revenue performance is a reflection not only of the opportunity that is inherent across our markets, but also the resilience of our affordable offerings despite the inflationary pressure many of our customers have experienced.

“Facilitating this growth has been, and will remain, fundamental to our performance. The investment in our distribution to catalyse growth, and the technology required to support this growth has been key. Furthermore, our rigorous approach to de-risking our balance sheet and our capital allocation priorities has materially reduced the risks that the currency de- valuation has had on our business.

“Key initiatives include the reduction of US dollar debt across the business and the ac- cumulation of cash at the HoldCo level to fully cover the outstanding debt due. We will continue to focus on reducing our exposure to currency volatility. At the beginning of March, we launched our first buyback programme reflecting the strength of our financial position.

“The growth opportunity that exists across our markets remains compelling, and we are well positioned to deliver against this opportunity. We will continue to focus on margin improvement from the recent level as we progress through the year.

“I want to say a particular thank-you to our customers, partners, governments and regulators for their support and our employees for their unrelenting contribution to the business. Our purpose of transforming lives across Africa will continue to be our highest priority.”

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