Safaricom net profit drops

Safaricom CEO Peter Ndegwa. [David Njaaga, Standard]

Safaricom has recorded a 1.7 per cent drop in profit after tax to Sh67.49 billion for the year ending March 31, 2022, compared to Sh68.7 billion for the same period last year.

The telco has cited a challenging business environment owed to Covid-19 and heightened regulatory risk as factors that contributed to the decline.

However, the firm says it has seen a return to its pre-Covid-19 levels of the Gross Domestic Product (GDP) growth in 2021.

“We are encouraged by the recovery from the pandemic in the past year. We have witnessed a return to the pre-COVID-19 levels of GDP growth in 2021,” Board Chairman Michael Joseph said in a statement.

M-Pesa revenue grew by 30.3 per cent totaling Sh107.69 billion in the 2021/2022 financial year, catapulted by the resumption to charging of previously zero-rated transactions, while transactions grew by 34 per cent to Sh29.55 trillion. The volume of M-Pesa transactions grew by 34.9 per cent to Sh15.7 billion.

According to the firm’s Chief Executive Officer (CEO) Peter Ndegwa, the telco also grew its mobile data revenue by 10 per cent in the second half of the 2021/2022 FY, to Sh24.8 billion. This was a 3.7 per cent increase from the first half of the same financial year.

“This was supported by our Customer Value Management (CVM) initiatives driving personalised offers to our customers. We remain committed to investing in a superior network quality and deepening mobile internet penetration through enhancing network coverage, increasing 4G handset penetration, and driving affordability of data,” Ndegwa said.

The telco had Sh65.31 billion in borrowings as of March 31, 2022, and remitted Sh124.7 billion in taxes and license fees.