Economy
Airtel Africa Grows Net Profit by 80% on Stable Net Finance Costs
By Dipo Olowookere
One of the leading telecommunications, Airtel Africa Plc, has reported an 80.2 per cent increase in its net profit for the accounting year ended March 31, 2022, despite a rise in tax charges.
The firm posted a post-tax profit of $755 million in the year under review compared with the $415 million recorded in the preceding year and was driven by higher operating profits and stable net finance costs amid a 48.2 per cent hike in tax payment caused by higher withholding tax on dividends by subsidiaries.
Analysis of the topline of the results showed that the revenue generated in the full year rose to $4.7 billion from $3.9 billion, with growth recorded across all its regions and key services.
Nigeria posted a 27.7 per cent in turnover, East Africa expanded by 22.7 per cent, while Francophone Africa grew by 17.2 per cent.
In terms of services, voice revenue grew by 15.4 per cent to $2.4 billion from $2.1 billion, data revenue increased by 34.6 per cent to $1.5 billion from $1.2 billion, and mobile money revenue grew by 34.9 per cent to $553 million from $401 million.
In the period under consideration, Airtel Africa was able to boost its earnings as a result of the increase in its customer base by 8.7 per cent, with the introduction of new SIM registration regulations in Nigeria contributing to the slow growth, though its customer base in the country, its biggest market, now stands at 128.4 million after addition of 2.4 million new customers.
In the year, the telco said it recorded an operating profit of $1.5 billion, 37.2 per cent higher than the $1.1 billion achieved a year earlier due to strong revenue growth and improvements in operating efficiency across all its regions.
Operating profit included a one-time cost of $32 million consisting of a $12 million provision for the expected settlement of a contractual dispute in which one of the group’s subsidiaries is a party, and $20 million costs relating to an agreement on historical spectrum fees in one of its.
This compared to the prior year which included a gain of $20 million for a one-time settlement in Niger, which was partially offset by one-off costs of $6 million in Francophone Africa.
As for the EBITDA, it grew by 29.0 per cent to $2.3 billion as a result of revenue growth and improved operating efficiencies.
While commenting on the results, the chief executive of Airtel Africa, Mr Segun Ogunsanya, said the company has again demonstrated its desire to continue to create value for customers and shareholders.
“We have delivered strong double-digit growth in revenues across all our regions and all our key services, with improving margins driven by strong cost control, and expanding cash generation which is enabling us to continue to invest in our network and services and expand our distribution, as well as strengthening our balance sheet and increasing our returns to shareholders. We are connecting more customers in new and existing coverage areas and driving usage levels and ARPUs to new highs,” he said.
“While the fundamentals of our six-pillar growth strategy remain unchanged, we are looking to accelerate our performance through a greater focus on digitalisation and we have underpinned our strategic pillars with our sustainability ambition,” he further said.
Mr Ogunsanya disclosed that “long-term opportunities for us remain attractive,” noting that the team will “continue to work actively to mitigate all our material risks and to deliver value for all our stakeholders.”
“There are increasing challenges from global inflationary pressures, but we continue to target revenue growth ahead of the market and moderate margin expansion,” he assured.
By Adedapo Adesanya
The Nigerian Exchange (NGX) Limited is seeking review of the controversial Capital Gains Tax increase, fearing it will chase away foreign investors from the country’s capital market.
Nigeria’s new tax regime, which takes effect from January 1, 2026, represents one of the most significant changes to Nigeria’s tax system in recent years.
Under the new rules, the flat 10 per cent Capital Gains Tax rate has been replaced by progressive income tax rates ranging from zero to 30 per cent, depending on an investor’s overall income or profit level while large corporate investors will see the top rate reduced to 25 per cent as part of a wider corporate tax reform.
The chief executive of NGX, Mr Jude Chiemeka, said in a Bloomberg interview in Kigali, Rwanda that there should be a “removal of the capital gains tax completely, or perhaps deferring it for five years.”
According to him, Nigeria, having a higher Capital Gains Tax, will make investors redirect asset allocation to frontier markets and “countries that have less tax.”
“From a capital flow perspective, we should be concerned because all these international portfolio managers that invest across frontier markets will certainly go to where the cost of investing is not so burdensome,” the CEO said, as per Bloomberg. “That is really the angle one will look at it from.”
Meanwhile, the policy has been defended by the chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr Taiwo Oyedele, who noted that the new tax will make investing in the capital market more attractive by reducing risks, promoting fairness, and simplifying compliance.
He noted that the framework allows investors to deduct legitimate costs such as brokerage fees, regulatory charges, realised capital losses, margin interest, and foreign exchange losses directly tied to investments, thereby ensuring that they are not taxed when operating at a loss.
Mr Oyedele also said the reforms introduced a more inclusive approach to taxation by exempting several categories of investors and transactions.
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
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