Safaricom: Kenya's most amazing money maker
Its shareholders will be the biggest beneficiaries of the super profits. As its 25 million customers strived to remain connected through short messages, telephone calls and the Internet, they earned the company Sh38.1 billion in net profits for the year ending March 2016.
SEE ALSO :Soya Awards set for January 11Following the performance, the firm said it had declared 76 cents per share held by thousands of its shareholders that include the government of Kenya and United Kingdom's Vodafone. This is an 18.9 per cent rise from what it paid out last year and the firm says it represents 80 per cent of its net income. The company made a total of Sh195.6 billion in revenue in the year under review from all its earning streams combined - voice, M-Pesa, SMS, mobile data, fixed service and sales of handsets among others. Its revenues are about a third of Kenya's GDP and can be used to pay half the Standard Gauge Railway (SGR) or build five Thika Super Highways. Service revenue for the company increased by 13.8 per cent to Sh177.8 billion while voice revenue (revenue made from calls) grew by 3.9 per cent to Sh90.8 billion. This made voice the revenue stream that posted the slowest growth. But Collymore said the growth was still decent if compared to what was happening in the voice market globally. On its part, the revenues that come from sources other than making calls (non voice revenue), grew by 26.3 per cent making this sector reach almost half of the entire revenue from services earned by the mobile company. Revenue from sending messages grew by 10.6 per cent to Sh17.3 billion. The firm attributed this growth to an increase in the number of short message services users due to its bundle offers and promotions. The firm earned Sh21.1 billion from mobile data, a growth of 42.7 per cent which it says was driven by a double-digit increase in 30-day active mobile data customers.
SEE ALSO :Kenyans vexed by M-Pesa outageThe firm now has 14.1 million active mobile data customers. This translates to a 21.5 per cent growth. M-Pesa continued to deliver strong growth that helped keep its profit engine running after it generated Sh41.5 billion in the year under review. This is a 27.2 per cent growth from the earnings in the year ended March 2015. The firm has a Sh30.4 billion in free cash flows, making it one of the most liquid companies on the Nairobi Stock Exchange. direct costs However, the firm's direct costs rose by 9.8 per cent from Sh56.7 billion to Sh62.3 billion. But it explained that operating expenses as a percentage of total revenue excluding construction was unchanged at 22.1 per cent despite the depreciation of the Kenyan shilling. The company said it has now realigned its sales and operations teams to be independently managed in six regions. The firm says the focus by the teams on the ground, plus a Sh32.1 billion investment in the network, has led to improved data speeds and voice network quality.